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TAPI pipeline Officials to finalize contract award in Ashgabat next week

This headline in today’s Express Tribune means good days are back for TAPI to the great relief of energy starved Pakistan.  But the irony is difficult not to miss.

Over a decade ago, to be precise in 1997, the State Department advised UNICOL, the first champion of TAPI to shelve the project fearing that the royalty from the venture to Afghanistan could land in Taliban’s hands, since Taliban was the master of Kabul then.

Now, in 2014, the situation is that Taliban is knocking at Kabul’s doors and the US led NATO forces are packing up to leave the war ravaged country. The Presidential elections are over but the result has few takers in the face of unprecedented rigging aimed at keeping former foreign minister Abdullah Abdullah.  

In place of UNICOL have Chevron and ExxonMobil, both American MNCs, and who will finally get the turnkey project of laying pipelines from gas- head in Turkmenistan to India through Pakistan and take it further to Northwest China.

The entire stretch through Afghanistan and Pakistan is a virtual minefield of terrorism. So is the North-West China where Uyghur Muslim militants, operating from their bases in North-West Pakistan are creating mayhem at regular intervals.

Put differently, the Pipeline route is a much sought after territory of Jihadists who are working overtime to herald their new Khalifat.

The Express Tribune dispatch has not gone into the security angle but focused on US lobbying to win the contract for its energy giants.

“The US is pushing the four countries to grant the lucrative pipeline contract to its energy giants. Two US firms – Chevron and ExxonMobil – are in the race to become consortium leaders, win the project and finance the laying of the pipeline,” a senior Pakistani official told the daily.

Pakistan has no hesitation to fall in-line with the American plans for TAPI. Anyhow it has no alternative having put in cold shouldered at the US behest Iran’s offer to supply gas at very competitive rates. The one big plus with Iran’s plan is that it has already completed laying of the pipeline virtually upto the border; more over it is also prepared to finance the venture to the great relief of cash strapped Sharif government.

But Islamabad’s dependence on IMF dole is such that it cannot go against the ‘advisories’ from Washington.

Which American giant will get the contract will be known next week when officials of Pakistan, India, Afghanistan and Turkmenistan meet in Ashgabat and take the call.    Asian Development Bank (ADB) is working on the bid documents in the meanwhile in its capacity as transaction advisor.  

Whoever gets to lead the consortium to finance and build the pipeline will have to grapple with a mundane issue – namely factor in unwillingness of Turkmenistan to not let foreign companies enter its onshore fields.

Chevron and Exxon Mobil have not yet resolved the issue of gas extraction with Turkmenistan. They want the contracts against financing for building the pipeline, but Turkmenistan says it can offer to swap the gas extracted from offshore fields with the gas from onshore fields for TAPI purpose. For this purpose it is offering offshore drilling concessions to the US firms.

As of now how the wind will blow is unclear. What is not unclear is prospects of TAPI are as bright as when the 1800-km long line was conceived to deliver 1.365 billion cubic feet of gas per day (bcfd) to Pakistan, 1.365 bcfd to India and 0.5 bcfd to Afghanistan.


 —RAM SINGH KALCHURI

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