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TAPI: Turkmenistan Challenged by China

Friday 3 August 2012

(World War 4 Report) – Regional security has been seen as the biggest challenge for the planned TAPI project, which would pass the war-torn Afghan provinces of Herat and Kandahar as well as Pakistan’s restive Baluchistan province. But recent reports of a rival pipeline project being negotiated between China, Afghanistan and Turkmenistan and Afghanistan may pose a more fundamental threat to the TAPI.

On June 6-8, on the sidelines of the TAPI “akin to the manner in which TAPI played spoiler to the Iran-Pakistan-India (IPI) pipeline project.”

While actual volumes of the proposed pipeline were not discussed or disclosed, it was agreed that a memorandum of understanding (MoU) would be signed when a CNPC delegation visits Kabul to discuss the proposal in greater detail, along with oil and gas exploration possibilities in Afghanistan’s Amu Darya basin, for which an agreement was signed between the Afghan Ministry of Mines and CNPC in December 2011. On returning to Kabul, President Karzai reportedly told Wahidullah Shahrani, the Minister of Mines, to prepare a framework agreement on cooperation with the CNPC and to set up a Chinese-Afghan joint working committee on these projects. CNPC and the Turkmen state firm, Turkmennebitgaz, also signed a framework agreement to increase ongoing gas deliveries to China to 65 billion m³ (bcm) from the current 30 bcm/year by 2014. The gas would be sourced from Turkmenistan’s Bagtyyarlyk gas field and possibly from sections of the South Yolotan field. This would, presumably, be the source for the proposed pipeline project as well. Interestingly, the additional Turkmen gas supply to China is expected to commence in 2014, the year TAPI is expected to begin construction.

The IPI proposal also stays viable, with Islamabad’s Petroleum Ministry ostensibly still committed to it despite having signed on to the TAPI. A source in the Pakistani government told The Nation newspaper that the Ministry of Petroleum and Natural Resources called a ministerial meeting next week to consider a natural gas pipeline from Turkmenistan and one from Iran. The U.S. government and Asian Development Bank have thrown support behind the TAPI pipeline.

Meanwhile, Turkmenistan, holder of the world’s fourth-largest natural gas reserves, announced last week it will hold road shows in September and October in Singapore, New York and London to hold meetings and presentations to invite leading international oil and gas companies and financial institutions to join the TAPI consortium.

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