ISLAMABAD: Construction of the much-anticipated Turkmenistan-Afghanistan-Pakistan-India (Tapi) gas pipeline will begin next week in Turkmenistan, some 25 years after the inception of the project, said Mobin Saulat, managing director of Interstate Gas Systems Private Ltd – the Pakistani company responsible for import of gas into Pakistan via the project.
Prime Minister Nawaz Sharif along with the Afghan and Indian leaders will attend the groundbreaking ceremony of the $10 billion project in Ashgabat, the capital of Turkmenistan.
Saulat said the dialogue to import gas for energy-starved Pakistan was initiated with Turkmenistan in 1990, adding that work on the pipeline will finally commence on Dec 13.
Interstate Gas Systems, along with Turkmenistan’s Turkmengas, Afghanistan’s Afghan Gas Enterprise and India’s Gail Ltd has equal shareholding in the Tapi Pipeline Company Limited (TPCL).
The Tapi project was a big challenge for Interstate Gas Systems and holds strategic importance for Pakistan, Saulat said.
Gas supply to Pakistan via Tapi project will begin in 2019, he said.
According to Saulat, Pakistan and India will get over 1.3 billion cubic feet per day of gas from Tapi while Afghanistan will get 0.5 billion cubic feet.
India will pay $200-250 million in transit fees to Pakistan while Pakistan will pay the same amount in transit fees to Afghanistan, he said.
Pakistan and India have both purchased five per cent shares of the Tapi project, Saulat said.
Turkmenistan has reached an agreement with Japan to develop its gas fields.
Earlier this month, Turkmenistan's President Gurbanguly Berdymukhamedov ordered state companies Turkmengaz and Turkmengazneftstroi to begin building the isolated republic's section of the pipeline.
Overall, the pipeline will stretch 1,800 kilometres and is likely to cost more than $10 billion.
Turkmenistan's official newspaper said the government expects the gas link, with an annual capacity of 33 billion cubic metres, to be fully operational by the end of 2018.
The Tapi project could help ease growing energy deficits in Asian giants Pakistan and India.
For Turkmenistan, which has been hit by low energy prices and dependence on China for the vast majority of its gas sales, Tapi is a key opportunity to diversify its exports.
But uncertainty hangs over the costly project. Aside from the risks associated with a link traversing war-torn Afghanistan, the four-country consortium has yet to confirm the participation of a foreign commercial partner willing to help finance it.
The project is politically complex, requiring cooperating governments, and logistically challenging, as the pipeline would pass through areas of Afghanistan and Pakistan plagued by Taliban and separatist insurgents.