China interested in linking of TAPI natural gas project

ISLAMABAD: China has articulated their interest in joining TAPI gas pipeline project, it is a multiple countries linking project with its financial close of the first phase is expected next month.

Originating at the giant Galkynysh gas field in Turkmenistan, the $9.6-billion TAPI (Turkmenistan, Afghanistan, Pakistan, and India) pipeline links four countries energy companies and will be carrying 33 billion cubic meters (BCM) of gas per year.

Turkmenistan is building the TAPI pipeline to expand its gas exports, which are mostly utilized by China. But this project has been on the verge of delays due to financial assistance issues along with the security risks of construction  of a pipeline through a war zone country Afghanistan.

Mobin Saulat, the chief executive officer of Pakistan’s state-owned Inter State Gas Systems (ISGS), told Reuters that Chinese officials have shown growing interest in building a spur from Pakistan and this line can act as a substitute to Beijing’s plans to build a fourth China-to-Turkmenistan pipeline.

Saulat stated, “With this channel, there is a possibility they don’t have to do another line and they can off-take from this pipeline which is passing through Pakistan.”

This China-to-Turkmenistan line has to cross several Central Asian mountain ranges and it will be contemptible and unproblematic for China to build a line from inside Pakistan’s territory to cross the Karakoram range to its Western border.

China’s relationship with Islamabad have intensified in contemporary years as Beijing has assured to fund $57 billion in infrastructure as part of its Belt and Road (OBOR) initiative, including power stations and transport links.

TAPI project is now due to be done in two phases, with the pipeline built without compressors in the first phase, which would cut gas volume but would diminish excessive project costs.

Once the natural gas starts its flow, and the pipeline begins spawning cash flow, the finances will be elevated for the second phase that would see 11 compressors installed along the 1,814 kilometres (1,127 miles) pipeline project.

Saulat also stated, “With this introduction of the phased approach, it has gained momentum with the Chinese.”

According to sources, the financial slam for the first phase is due by the end of September, as the aids are expected from Asian Development Bank (ADB) of about $1 billion to $1.5 billion and the Islamic Development Bank has assured an amount of $1 billion in loans.