Cost of TAPI Gas Pipeline Could Rise to $10 bn

Delay in implementation could push up cost of Turkmenistan, Afghanistan, Pakistan and India (TAPI) gas pipeline project to $10 billion, Asian Development Bank has warned.

According to Pakistan’s Express Tribune newspaper earlier estimates had put the cost at $7.5 billion, which will now go up by $2.5 billion, which officials say would also include development cost of gas fields.

Officials from the four countries met in Islamabad on Wednesday during the TAPI steering committee meeting. The committee will deliberate to finalise the award of a multi-billion-dollar contract to French energy giant Total.

Officials added that Turkmenistan had agreed to award the contract to Total as the four nations gathered to discuss the service contract agreement to be signed with the French company, which would function as a consortium leader, Express Tribune added.

Under the contract, Turkmenistan will pay a service fee to Total for development of the fields and the French entity will bear the costs associated with laying the pipeline.

Last year, gas companies of Turkmenistan, Afghanistan, Pakistan, and India established a company that will build, own and operate the planned 1,800-kilometer natural gas pipeline.

Turkmengas, Afghan Gas Enterprise, Inter State Gas Systems, and GAIL (India) Limited own equal shares of the company.

The TAPI pipeline will export up to 33 billion cubic meters of natural gas a year from Turkmenistan to Afghanistan, Pakistan, and India over 30 years.