Turkmenistan-Afghanistan-Pakistan-India (TAPI) Gas Pipeline Project

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TAPI gas pipeline has a diameter of 56in and will transport 33bcm of natural gas a year. Credit: Ministry of Foreign Affairs Afghanistan. The 1,814km-long TAPI pipeline will run across four countries. Credit: Ministry of Foreign Affairs Afghanistan. The ground-breaking ceremony for the pipeline project was held in December 2015. Credit: Ministry of Foreign Affairs Afghanistan. The Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline will be a 1,814km trans-country natural gas pipeline running across four countries. Also known as the Peace Pipeline and Trans-Afghanistan Pipeline, the TAPI pipeline will begin in Turkmenistan and traverse Afghanistan to enter Pakistan and India. A special-purpose consortium known as the TAPI Pipeline Company (TPCL) was incorporated in November 2014 by Turkmengaz (majority stakeholder with 85% interest), Afghan Gas Enterprise (5%), Inter State Gas Systems (5%), and GAIL (5%) to execute the $10bn project, with Turkmengaz leading the consortium. A stone-laying ceremony was held to commemorate the start of construction of the Turkmenistan-Afghanistan section of the TAPI gas pipeline in December 2015 in Mary, Turkmenistan, near the Galkynysh gas field. The investment agreement for the development of the TAPI project was signed by the four countries in February 2016. The ceremony marking the beginning of construction of the Afghanistan-Pakistan section of the pipeline was held in February 2018. Designed to serve for 30 years, the pipeline is expected to commence operations in 2021. It is expected to transport 33 billion cubic metres (bcm) of natural gas a year. The plan for the TAPI project was originally conceived in the 1990s to generate revenue from Turkmenistan’s gas reserves by exporting natural gas via Afghanistan to Pakistan and India. An inter-governmental agreement (IGA) was signed in 2010 by the heads of four member nations. A Gas Pipeline Framework Agreement (GPFA) was also signed by the petroleum ministries of the four countries in December 2010. The bilateral gas sale agreement was signed in May 2012. Turkmengaz, Afghan Gas Enterprise, Inter State Gas Systems, and GAIL were nominated as shareholders by their respective countries to promote and invest in the pipeline project in 2013. The state-owned companies of Pakistan and India are each expected to purchase 42% of the total volume of produced gas, equating to approximately 14bcm. Afghanistan is expected to purchase 16% of the gas, which approximates to 5.11bcm. Afghanistan will also receive $400m a year as transit fee for the pipeline. The TAPI gas pipeline will transport gas produced from the Galkynysh gas field in Turkmenistan to Afghanistan, Pakistan and India. It will have a diameter of 56in and a working pressure of approximately 10,000 kilopascals (kPa). The pipeline will start from Mary region of Turkmenistan and cover a total distance of 214km up to Afghanistan. The Afghanistan section will be built along the highway. The pipeline will run through Kandhar and Herat highway in Afghanistan, for a length of 774km. It will cover 826km in Pakistan, across the cities of Quetta and Multan, finally terminating in Fazilka at the Indo-Pakistan border in Punjab region, India. The pipeline will initially transport 27bcm of natural gas a year, which will be increased to 33bcm after one year of operation. The TAPI pipeline is being constructed in two phases. A free flow pipeline with a capacity of delivering approximately 11bcm/year will be developed in the first phase, with two compressor stations in Turkmenistan. The second phase will add six compressor stations in the Afghanistan and Pakistan regions to increase the delivery capacity to approximately 33bcm/year. Galkynysh gas field will feed gas to the pipeline section in Turkmenistan. Overall, the pipeline will supply 90 million metric standard cubic metres (Mmscm) of natural gas a day. Afghanistan will purchase 500Mmcfd, while Pakistan and India will buy 1,325Mmcfd of gas each. The TAPI project is being funded by the Asian Development Bank (ADB), which is also acting as transaction adviser for the development. Turkmenistan took a loan of $700m from Islamic Development Bank for financing the project in December 2016. The remaining three countries made an initial investment of $200m in the TAPI project. Penspen, a company based in the UK, was contracted to conduct the technical feasibility studies for the TAPI project. Penspen subcontracted Royal HaskoningDHV to carry out various studies related to the environmental and social safeguard components of the initiative. ILF Consulting Engineers was awarded a contract to conduct the front-end engineering and design (FEED) studies for the pipeline. Global Pipe Company, a Saudi-German JV company, received a $40m contract for the development of the TAPI gas pipeline. The scope of the contract also included the provision of technical supervision services for the Afghanistan-Pakistan section of the pipeline network. Portland, Allen & Overy, and Gas Strategies are the other legal and technical advisers for the project. Thepipelineis expected to facilitate a unique level of trade and co-operation across the region, while also supporting peace and security between the four nations. More than 1.5 billion people in Afghanistan, Pakistan, and India are expected to benefit from the long-term energy security provided by the project. In addition, the project is expected to boost the revenues of Turkmenistan via the sale of gas. Afghanistan and Pakistan will also receive benefits through transit fees.

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