Thursday, May 14, 2009

Govt to reactivate TAPI gas pipeline project

* Official says ADB willing to finance 25% of project cost\05\14\story_14-5-2009_pg7_16

ISLAMABAD: The government has decided to reactivate the multi-billion-dollar Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project, and is considering taking 25 percent of the total amount from the Asian Development Bank (ADB) for this purpose.

According to a senior official of the Ministry of Petroleum, a tripartite agreement was signed by Turkmenistan, Afghanistan and Pakistan in December 2002 for laying hundreds of kilometres of gas pipeline from Turkmenistan to Pakistan via Afghanistan.

The ADB was acting as the lead developer and coordinator for the project. It sponsored a feasibility study in 2003 – completed by a British consulting firm, Penspen, in 2004 – for laying a pipeline to carry 3.2 million cubic metres of gas per day from Turkmenistan through Herat and Kandahar in Afghanistan and terminating in Multan in Pakistan.

Financing: In order to be processed further, transaction advisory services by an international consultant are being considered wherein the ADB has indicated that it will be willing to finance 25 percent of the cost of such services, provided the remaining cost is shared equally among the participating countries, the official said.

The 1,680km pipeline was suppose to run from the Dovetabat gas deposit in Turkmenistan to Fazilka, a town in Indian near the border with Pakistan, he said. The official said India also expressed its willingness to join the project later, and the Inter-Governmental Framework Agreement (IGFA) signed in December 2002 was amended in April 2008 to facilitate Indian participation. All four governments initiated the revised IGFA, but a formal signing of the agreement is still pending, awaiting completion of some 'enabling actions' required to be completed by Turkmenistan and Afghanistan. "These principally includes the signing of the agreement as well as certification of reserves held by Turkmenistan," he said.

The original estimate of the pipeline project in 2004 was $3.3 billion, which was revised to $7.6 billion in 2008. Responding to latest position of the ADB about the project, he said, "The bank has indicated that it would consider further investment only if the parties agree to move ahead with indication of tangible progress in the future." app

Navdeep Asija
Fazilka - 152123

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