Taliban pledge protection as construction starts on Afghan part of TAPI pipeline

Taliban pledge protection as construction starts on Afghan part of TAPI pipeline
/ Asian Development Bank.
By bne IntelliNews February 26, 2018

The leaders of Afghanistan, Pakistan, and Turkmenistan gathered on February 23 to mark the launch of construction works on the Afghan segment of the $10bn Turkmenistan-Afghanistan-Pakistan-India (TAPI) natural gas pipeline. The ceremony presented the 1,814-kilometre (1,144-mile) pipeline pipeline as heralding an extensive corridor of road, rail, and communications infrastructure networks that could eventually connect the Central and South Asian countries.

Turkmenistan has committed to covering 85% of the project’s costs, which is something of a problem as things stand right now as the remote nation appears to be scraping by to cover its own budget revenues given the consequences of low world oil prices and longstanding difficulties in diversifying gas exports beyond supplies to China. But regular updates issued on the TAPI construction works, including for the non-Turkmen segments of the pipeline, appear to demonstrate a continued commitment to make the pipeline a reality.

The Afghan section of the pipeline is seen as the riskiest segment of the project due to the presence of extremist groups in the conflict-torn country and its success or otherwise will determine the fate of the whole TAPI route.

In a surprise statement on February 23, the Taliban pledged its cooperation and protection for the project, noting the pipeline’s importance to building up Afghanistan's economic infrastructure. "There will be no delay in this important national project," the Taliban said.

"South Asia is being connected with Central Asia through Afghanistan after more than a century of division," Afghan President Ashraf Ghani said at the ceremony on February 23.

"It will lead from a gas pipeline into an energy and communications corridor," Pakistani Prime Minister Shahid Khaqan Abbasi said.

Backers of the project, including the US and the Asian Development Bank (ADB), say it will help ease energy deficits in South Asia as well as reduce tensions in the divided region.

It is planned that the Afghan component of TAPI will follow the 557-km (346-mile) Kandahar-Herat highway. Afghan officials have previously said that Kabul will annually earn some $500mn in transit fees from TAPI and that the project will help create thousands of jobs.

However, the start of construction works on the Afghan segment of TAPI comes with the present state of the Turkmen section rather unclear - no reports officially announcing the end of construction works on the Turkmen part of the pipeline have been put out and some analysts are even questioning whether a Turkmen segment exists because of the lack of any tangible information on the status of the project coming from the tightly controlled country.

The TAPI consortium wants its pipeline to start exporting gas to Pakistan by 2020. Turkmenistan hopes construction works in Afghanistan and Pakistan are finished by 2019. The deadline for the Indian segment of the pipeline is unclear.

Work on the pipeline started in December 2015. The slow progress indicates that the construction of the infrastructure might take longer than the originally projected period of three years.

TAPI is expected to export 33bn cubic metres (cm) of natural gas per year from Turkmenistan’s Galkynysh gas field, one of the world's largest hydrocarbon fields with estimated reserves of 13,100bn cm of natural gas, to Pakistan and India via Afghanistan.

In September 2016, India proposed constructing a $4bn and 1,300 km-long undersea pipeline to supply natural gas from Iran, with the possibility of Turkmenistan participating in the project via swap operations with Iran. Such a pipeline could be at odds with TAPI.

The four main gas companies in the countries involved in the TAPI project – Turkmengas (Turkmenistan), Afghan Gas Enterprise (Afghanistan), GAIL (India) and Inter State Gas Systems (Pakistan) – each own an equal share of the TAPI pipeline company, as agreed in November 2014 when the enterprise was set up.