ADB wants GSPAs signed for TAPI this month

Vol 14, PW 26 (30 Jun 11) People & Policy

Manila-based Asian Development Bank (ADB) is working hard to remove the remaining hurdles to a proposed 1700-km TAPI gas pipeline so GSPAs can be signed by the end of next month on July 31.

PETROWATCH learns the ADB sent e-mails to each stakeholder country on June 6 suggesting solutions to outstanding disagreements blocking progress on the pipeline from Turkmenistan through Afghanistan and Pakistan to India. First priority for ADB is to fix a ‘delivered’ gas price.

But TAPI customer countries India and Afghanistan want to independently negotiate their own gas price with Turkmenistan, which will sell gas through the pipeline from its Dauletabad gasfield, while Pakistan is calling for joint gas pricing discussions with all member countries involved. In its e-mail, seen by this report, ADB assures member countries either approach is “workable.

” Another lingering TAPI disagreement is over the notice period that customer countries Afghanistan, India and Pakistan must give Turkmenistan before taking gas supplies. Turkmenistan wants at least three days notice before the start of any given month of all the gas quantities needed over every day of that month.

Once notice is given, Turkmenistan says TAPI customers cannot change their minds and demand different gas quantities. But ADB is supporting TAPI customer countries who want to give a rough monthly estimate of their gas demand to Turkmenistan and then confirm the daily gas quantities with 24 hours.

This is a typical arrangement in most international GSPAs, argues the ADB. More, it is not unusual for a gas customer to abruptly change its gas requirement on any given supply day.

“Modern control and communication systems make this easy to manage for most gas sellers,” we learn. As a compromise, the ADB suggests each TAPI customer country should give ‘final and binding’ notice of the gas quantity it needs for at least 24 hours in advance.