India approves TAPI special purpose vehicle, GAIL’s participation

India’s cabinet has approved formation of a special purpose vehicle (SPV) for the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline project and permitted GAIL India Ltd. to join the SPV, TAPI Ltd. Turkmenistan last year suggested formation of the SPV as a way to fast-track the project.

The SPV will take up feasibility study and design work for TAPI to meet agreed timelines while also search for a consortium lead.

GAIL and TurkmenGaz last year signed a sale-purchase agreement for Turkmen gas shipped via TAPI (OGJ Online, May 23, 2012). India’s Minister of Petroleum and Natural Gas, Shri S. Jaipal Reddy, said at the time that India’s consumption of gas would increase from 166.2 MMcfd to 473 MMcfd in 2017.

TAPl Ltd. requires an initial $20-million of funding, $ 5 million from an identified entity in each of the four participating countries. GAIL, a Maharatna Co., will make this investment for India. India said an active interest in TAPI by all the partner countries would sustain the project’s credibility and generate interest in the international market to pave the way for selection of an appropriate consortium leader.

At 1,680 km and built with 56-in. OD pipe, TAPI would transport gas from Turkmenistan's Daulatabad field to Fazilka, Punjab, India, at a capacity of 27 billion cu m/year, with part of this total drawn off in Afghanistan and Pakistan. Its earliest in-service date would be 2017.

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