Turkmenistan-Afghan-Pak-India natural gas pipeline is likely to be implemented by a consortium of companies representing the 4 countries.
NEW DELHI: The Turkmenistan-Afghanistan-Pakistan-India natural gas pipeline is likely to be implemented by a consortium of companies representing the four countries. The consortium approach is part of a draft framework agreement that the ministry of petroleum and natural gas has circulated for discussion with other ministries.
This comes even as the fate of another framework agreement for Iran-Pakistan-India natural gas pipeline is unclear. Sources said a meeting of the steering committee of the participating countries was scheduled to be held on August 22-23, 2007 at Islamabad, where the draft would be further fined tuned based on suggestions of the four countries.
Each country under the draft agreement would have the option of becoming a member of the consortium that would construct and manage the pipeline. It is envisaged that the lead partner in the consortium would be a company that has a Standard and Poors rating of not lower than BBB+ or Moody’s Investors Services rating of not lower than BAA1.
The rating requirement could mean that Afghanistan may be unable to get its own company as the lead partner.
The consortium would enter into individual pacts with the countries. Also, the participating countries would together hold some kind of contest among the consortium members for choosing the lead partner. The lead company would be the one that offers best realisation from the project within the shortest period.
The consortium would have the right to market gas to markets other than the four countries, said sources. The pipeline would have capacity for natural gas supplied in addition to the Turkmenistan gas, but initially contracted quantities for the four countries will have precedence over other supplies.
In the event of additional Turkmen gas being injected into the system, each of the four countries would have the right of first refusal to buy the same in proportion to the initial contracted quantities. Pakistan would host a gas processing infrastructure at its Gwadar port for export to world markets, but gas so exported would be surplus gas over the contracted quantities of other parties.
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