TAPI countries stuck on fuel pricing

India worried over gas pipeline passing through Pakistan, Afghanistan

At the day-long ministerial level meeting on the TAPI pipeline project, the four countries, while finalising the terms of Gas Sale and Purchase Agreement (GSPA), decided to hold further deliberations on pricing of gas as well as transit fees, official sources said.

The two key buyers of the gas—India and Pakistan-- are learnt to have expressed “reservations” over the price of gas proposed by Turkmenistan.

The ministerial meet could not arrive at “any definite” figure on the transit fee India has to pay to Pakistan and Afghanistan for allowing passage of the gas.

Officials of the four countries will hold a two-day meet in Kabul from May 13 to deliberate specifically on the mechanism for fixing the transit fee.

“Once issues relating to transit fees are resolved, the four countries will meet in Turkmenistan to decide on pricing of gas,” official sources said.

The countries also decided at the meeting to postpone the date of signing the GSPA from April end to July 31.

Earlier at the meeting, India, while expressing its commitment to expeditiously conclude all formalities for commissioning the TAPI project, raised the issue of safe delivery of fuel through the pipeline.

“There are issues that need to be addressed. We have to come to a decision regarding the price of gas, security of the pipeline, certainly of gas supply, transit fee and setting up of the consortium,” Petroleum Minister  S Jaipal Reddy said at the meeting.

India is understood to have expressed concerns relating to safety of the pipeline and safe transit of gas through Afghanistan and Pakistan, sources said.

The TAPI project envisages building a 1,735-km pipeline with a total gas capacity of 90 million standard cubic meters per day (MMSCMD).

The pipeline will run from Turkmenistan's Yoloten-Osman gas field to Heart and Kandahar (Afghanistan), before entering Pakistan, where it will reach Multan via Quetta before ending at Fazilka (in Punjab) in India.

On completion of the project, both India and Pakistan are expected to receive 38 MMSCMD of gas.

Though it was planned to be completed by end of 2014, the deadline for the project has now been revised to mid-2016.

In December last year the four countries met in Turkmenistan to sign the GSPA.
The question of reviving talks on an early implementation of TAPI pipeline had come up for discussion during Prime Minister Manmohan Singh’s visit to Kazakhstan earlier this month.