(adds background, details, quotes)
By Drazen Jorgic
ISLAMABAD Oct 14 A long-delayed pipeline
project from Turkmenistan to Pakistan and India via Afghanistan
is in the final stages of financing, and investor roadshows are
due to be held next month, a Pakistani official involved in the
project said on Friday.
Originating at the giant Galkynysh gas field in
Turkmenistan, the $10 billion TAPI (Turkmenistan, Afghanistan,
Pakistan and India) pipeline, which involves the four countries'
own energy companies, would carry 33 billion cubic metres (bcm)
of gas a year.
But difficulties in obtaining financing for the project and
concerns about security in Afghanistan, where Islamist Taliban
insurgents control swathes of the territory earmarked as the
pipeline route, have led to lengthy delays.
Mobin Saulat, head of Pakistan's state-owned Inter State Gas
Systems (ISGS), told Reuters there was "significant progress"
with the TAPI project and that investor roadshows to raise funds
are planned for November.
"There will be roadshows soon in all the major financial
hubs," he said. "The project's planned commissioning is 2020 and
I think we are very much on target."
Over the decades, international oil giants have expressed
interest in the proposed pipeline, but the region's complex
geopolitics and contract disagreements meant none ever fully
A total $4 billion for the pipeline has been put forward by
the four TAPI countries, Saulat said. Pakistan's ISGS has a 5
percent stake in the 1,814 km (1,127 mile) pipeline project.
Saulat said the Asian Development Bank had shown interest in
funding some of the project and there was "huge interest shown
and commitments made from some of the major suppliers who said
they would be able to get supplier credit."
Turkmenistan, which sits on the world's fourth-largest gas
reserves, last December started building its section of the
pipeline, designed to ease its dependence on Russia and China,
but the three other countries have yet to begin work.
Saulat said selecting project management consultants for
TAPI was in the "final stages" and TurkmenGaz, Turkmenistan's
national gas company, was in advanced talks with suppliers about
the purchase of giant compressors, needed to funnel gas down the
TAPI is one of three main pipeline projects aimed at
securing long-term energy supplies to Pakistan, where chronic
energy shortages are proving a major drag on growth.
The other two planned projects include a $2 billion
Russian-funded North-South liquefied natural gas (LNG) pipeline
from the coast city of Karachi to Pakistan's industrial
heartlands in Punjab, and a Chinese-funded LNG pipeline starting
from a proposed LNG terminal at the port city of Gwadar in
Saulat said Pakistan expected to finalise contracts for the
(LNG) terminal at Gwadar port in November and the final deal for
the Gwadar-Nawabshah pipeline should be finished this month.
"We have had a number of sessions with the Chinese team, so
we see an immediate kick-off after we sign the contracts."
China has agreed to fund 85 percent of the port and pipeline
project and Pakistan will pay the rest, Saulat said. Officials
expect the terminal and pipeline to be complete in mid-2018, and
local media put the cost of the deals at about $2 billion.
Saulat, who is also managing director of newly-formed
Pakistan LNG, said Azerbaijan's state energy company SOCAR had
approached the country to supply it with LNG gas.
Saulat said the approach was linked to Pakistan's plans to
issue two international LNG tenders for 750,000 tonnes per year,
most likely due before the end of 2016.
"Their trading wing is actually interested, but again, it's
one of the players, we have to follow the process."
(Reporting by Drazen Jorgic; Editing by Mike Collett-White)