BD again wants to join TAPI gas pipeline project

The government has shown renewed interest to join the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project to meet the country's mounting natural gas demand, a top official said Wednesday.

"We visited Turkmenistan last week and talked with top officials of the Ministry of Oil and Gas Industry and Mineral Resources of Turkmenistan over taking part in the TAPI project," Petrobangla Chairman Hussain Monsur told the FE on his return from Turkmenistan.

"We have conveyed our interest to join TAPI as we are struggling to meet mounting natural gas demand with local production," he said.

Turkmenistan has responded positively and welcomed our desire, he added.

"We shall start formal talks with all concerned including the TAPI participating countries and Asian Development Bank, the facilitator of the project," Mr Monsur said.

Additional Secretary of the ministry of power, energy and mineral resources (MoPEMR) of Bangladesh Md Abu Taher accompanied Monsur on the Turkmenistan tour.

Earlier in May 2012, Bangladesh had sent an initial proposal to the TAPI steering committee expressing its interest to be a part of the TAPI gas pipeline to ensure an alternative source of energy to meet its growing fuel demand.

The TAPI steering committee had accepted the proposal from Bangladesh and had asked for a more detailed plan.

After that Bangladesh did not move ahead as its state-owned Gas Transmission Company Ltd (GTCL), in a preliminary study, found the country's inclusion in the TAPI project non-viable.

"We have seen that Bangladesh's inclusion in the TAPI project will not be economically viable due to the long distance from the source country," the then GTCL Managing Director Mohammad Aminur Rahman said.

Ashgabat in Turkmenistan is around 3,417 kilometres (2,123 miles) from Dhaka and the distance of TAPI's last location -- New Delhi -- is around 1,424 km from Dhaka.

If Bangladesh gets connected with the TAPI project, it will have to pay a large amount of money as wheeling charges to the countries through which the gas will pass -- Afghanistan, Pakistan and India -- on top of the actual price for Turkmen gas.

Besides, Bangladesh will also have to construct gas transmission pipelines covering around 1,424 km to carry the gas from TAPI's last point to the country.

But the dismal picture over the country's future natural gas exploration has pushed the country to rethink joining with TAPI, a senior official of the MoPEMR said.

Under the latest bidding round of 2012, the country signed only three production sharing contracts (PSCs) for shallow water blocks with two joint ventures after receiving one bid for each of the three blocks, which were among nine on offer.

Blocks SS-04 and SS-09 were awarded to a joint venture between India's ONGC Videsh Limited and Oil India Limited, and SS-11 to a joint venture between Australia's Santos and Singapore's KrisEnergy.

US-based ConocoPhillips refused to ink the fourth PSC for block SS-07 seven months after signing an initial PSC for the block, saying after further evaluation it was no longer competitive in the company's portfolio.

Oil and gas exploration activities in the new blocks have not yet started.

Relating to TAPI participation the Petrobangla chairman said Bangladesh will be benefited more if the proposed TAPI gas pipeline extends to West Bengal of India instead of New Delhi.

"We shall raise the issue with India soon," Monsur said.

Bangladesh's current natural gas production is hovering around 2,340 million cubic feet per day (mmcfd) against the demand of around 3,000 mmcfd.

The country is currently dependent only on domestic natural gas production to meet local demand.

Gas shortages in Bangladesh have prompted Petrobangla to ration new connections to industries, fertiliser factories and power plants, hindering economic growth since June 2009.

Separately the PakTribune on May 1, 2014 reported that China has shelved a plan to be part of the Iran-Pakistan (IP) gas pipeline that faces the threat of US sanctions and has come up with an offer to join the TAPI gas pipeline to meet its growing energy needs.

Beijing plans to lay a pipeline under the TAPI project from Gwadar to China, which will turn Gwadar Port into an energy corridor, it reported.

Already, China has taken over operational control of Gwadar Port where it will establish an industrial city, the PakTribune stated.

Under the TAPI project, Pakistan will get 1,365 mmcfd of gas from Turkmenistan, India will also receive the same amount and Afghanistan will get 500 mmcfd.

Turkmenistan will export natural gas through a 1,800km pipeline that will reach India after passing through Afghanistan and Pakistan.

Pakistan and India have already signed gas sale and purchase agreements and efforts are under way to attract potential investors for financing the project, it reported.

In another development, Iran has expressed its interest to join TAPI to start delivery of its own gas to India, the Azerbaijan Business Centre reported Wednesday.