Turkmenistan, Ashgabat, July 16 / Trend H. Hasanov /
Afghanistan has announced the details of the gas agreement with Turkmenistan, signed within the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project in Ashgabat last week.
This contract was signed between Afghan Gas and Turkmen Gas companies and the Ministries of Mines and Petroleum of Afghanistan and Turkmenistan, the Afghan Foreign Ministry said today.
The signing of this contract is considered as a fundamental and practical step towards implementing the TAPI Project through which Afghanistan will address its gas needs for the next 30 years, the statement said.
Based on this contract, following the completion of this project, Afghanistan will purchase 500 million cubic meters of gas in the first ten years, and 1bilion and 1.5 billion cubic meters of gas annually in the second and third ten years respectively.
At this meeting, the four countries in cooperation with the Asian Development Bank, agreed to establish a joint consortium entitled TAPI Ltd by the end of 2013 which will comprise of the gas companies of the member countries, the statement said.
As a result of the transit of this pipeline, Afghanistan will also earn about $ 500 million annually.
The basic document for the promotion of TAPI project is the Ashgabat interstate agreement of the state parties on the commencement of the practical implementation of the TAPI project signed in late 2010. The instability in transit Afghanistan remains a serious obstacle, but Kabul said the country will ensure the safety of the route.
In May 2012, the Turkmen government entered into an agreement for the sale of natural gas with India's GAIL Ltd. A memorandum of understanding was signed with Afghanistan.
Negotiations are currently underway on the formation of the consortium and the financial package. The Turkmen side conducted several international road shows for TAPI in September 2012 with the participation of the Asian Development Bank.
It was reported that Chevron, Exxon Mobil, BP, BG Group, RWE, Petronas and other companies expressed intentions to participate in the project.
The design capacity of TAPI is 33 billion cubic meters of natural gas per year. The estimated length is 1,735 kilometres. It is expected that the pipeline will extend from the largest gas field in Turkmenistan, Galkhynysh, through the Afghan cities of Herat and Kandahar to the Fazilka settlement on the Pakistani-Indian border.