Tapi gas pipeline transit fee: Asim to visit India for talks

ABDUL RASHEED AZAD

ISLAMABAD: Minister for Petroleum and Natural Resources Dr Asim Hussain would visit India in December 2011 to negotiate the transit fee for planned Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project, Business Recorder has learnt.

Pakistan on November 14 signed initial Gas Sales Purchase (GSP) agreement with Turkmenistan, which was a landmark achievement. Talking about the next steps regarding the TAPI project, sources said that this would be followed by the signing of 'Heads of Agreement' and Transportation and Transit accords by the end of the year.

Sources said India is reported to have already finalised gas price with Turkmenistan under the TAPI project, and it has negotiated a transit fee with Pakistan.

An encouraging aspect of the deal is that it would help to open up a price accord which Pakistan had signed with Iran about two years ago for delivery of 750 mmcfd at about 78 percent of the price of crude. Under the price review mechanism inbuilt in the Pak-Iran GSPA, the pipeline gas price has to be renegotiated on the basis of alternative fuel prices (Turkmen gas in this case) a year before the commencement of the gas deliveries scheduled by Dec 31, 2014.

The 1,680 km long TAPI gas pipeline would bring in 3.2 billion cubic feet per day (bcfd) of natural gas from Turkmenistan's gas fields to Multan and end at the northwestern Indian town of Fazilka.

Under the agreement, Afghanistan's share would be 500 million cubic feet per day (mmcfd) while Pakistan and India would receive 1,325 mmcfd each.

Petroleum Ministry officials dispelled reports of slow progress on the $ 7.5 billion Iran-Pakistan (IP) gas pipeline project, and said the project was proceeding as per the target.

They said that the construction of the 2,775 km long pipeline was likely to start by March next year, adding that Iran has already completed around 900 km of pipeline on its side, with around 200 km long still remaining.