Ashgabat, Turkmenistan, June 21
By Huseyn Hasanov– Trend:
A road show will be organized, starting from next month, to promote the Turkmenistan-Afghanistan-Pakistan-India gas pipeline project (TAPI) and conduct negotiations with investors, Mohammetmyrat Amanov, the chief executive director of the consortium TAPI pipeline Company Ltd, said on Wednesday at an international UN conference in Ashgabat .
At the moment, a team of financiers is being formed and starting next month it is planned to start a road show, to familiarize with the project and conduct negotiations, Amanova said in a distributed report.
A series of meetings were held with a number of export credit agencies - ECA (including SACE, Hermes and ECIO), and all of them expressed strong support for the project.
There is also intensive work with the Asian Development Bank (ADB), which has provided and continues to provide full support to the project. According to the agreements, the bank plans to support the project in two directions, sovereign financing, covering part of its own capital; and direct financing of the project company.
"The financial closure of the project is expected in the third quarter of 2018. "The work is on schedule in order to start gas supply by the end of 2019," Amanov said.
The project is legally supported by British Allen & Overy, technically by German ILF Consulting Engineers. Soon the appointment of a Project Management Consultant (world-class level) and financial adviser will be announced.
According to the experts, the possible costs for the TAPI project range from $7 billion.
The project was originally conceived in the 1990s, with the aim of monetizing Turkmenistan's huge natural gas reserves. Since 2007, the contractual and legal framework has been consistently updated.
In 2013, the governments of Turkmenistan, Afghanistan, Pakistan and India appointed state gas companies, respectively, Turkmengaz, the Afghanistan Gas Company, Inter State Gas Systems (Private) Limited and the company GAIL (India) Limited to promote the project and investments in the TAPI project.
In November 2014, the company TAPI Pipeline Company Limited was established.
The TAPI project, a pipeline length of 1,840 kilometers, is designed to deliver natural gas from Turkmenistan to India. The project is planned to be implemented in two phases, and after full commissioning, it will export up to 33 billion cubic meters of natural gas per year for 30 years.
"Turkmengaz" is actively working on the development of part of the Galkynysh deposit, which will serve as a raw material base for the pipeline.
According to Amanov, agreements were signed on the gas pipeline, gas purchase and sale contracts, the main terms of the agreement with Afghanistan.
Signing a similar document with Pakistan is planned in the near future. Work is underway to prepare and conclude a package of agreements on transit, gas transportation services, etc. In parallel, consultations are held with partners on the technical side of the project. Recently, several rounds of talks were held in Pakistan with the participation of state structures, as well as operators of distribution networks.
Regular consultations are held in Afghanistan. All prospecting contracts have been signed, and it is expected that all field work will be completed at the end of this month.
Currently, the progress at this stage is 87 percent. The mentioned consultations include geotechnical research and aerial photography, detailed pipeline route research, research and clearance of the route from munitions, environmental and social impact assessment, drawing up a plan for the allocation of land for which field studies are completed in four of the five provinces of Afghanistan, and so on.
Tender processes for key components, such as large-diameter linear pipes, taps and large valves, have been completed, internal agreement is currently underway and it is expected that contracts will be prepared for conclusion in the near future, Amanov noted.
The tender results will be available next month, after which the internal agreement procedure and contract approval will also be launched. The financing plan for the first phase is completed and consists of sovereign credit financing from several ECAs, development banks and commercial banks.