Indian Cabinet Approves TAPI Pipeline Deal

India’s Union Cabinet Thursday approved the proposal of the Ministry of Petroleum & Natural Gas to permit GA1L( India) Limited to sign the Gas Sale & Purchase Agreement (GSPA) with TurrnenGas, Turkmenistan's national oil company, for the $7.6 billion Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project. 

The pipeline is envisaged to be 1680 Km in length (144 Km in Turkmenistan, 735 Kin in Afghanistan & 800 Km in Pakistan) with a capacity of 90 MMSCMD of gas, with 38 MMSCMD each for India and Pakistan and the remaining 14 MMSCMD for Afghanistan.

The pipeline would originate from Turkmenistan’s Galkynysh gas field to reach Fazilka in Punjab, via the Afghan cities of Herat and Kandahar and Quetta and Multan in Pakistan. The Galkynysh gas field is estimated to hold 16 trillion cubic metres of proven recoverable gas.

Although there has been no indication of price, media reports say that India is expected to pay a price of about $8 to $10 per million British thermal unit. Apart from the gas price, India will pay $0.50 per mmBtu (million metric British thermal unit) as a transit fee to Afghanistan and Pakistan. Price of delivered gas at Indian boarder will likely be $10-$12 per mmBtu compared with $4.20 per mmBtu price of domestic gas and $16 per mmBtu rate of gas imported in ships in liquid form.