September 15, 2015 / 7:56 AM / 4 years ago

UPDATE 1-Turkmenistan to start work on TAPI pipeline in December

(Adds quotes, details, background)

By Marat Gurt

ASHGABAT, Sept 15 (Reuters) - Turkmenistan, keen to diversify its natural gas exports, will start building a long-delayed, $10 billion gas pipeline to Pakistan and India via Afghanistan in early December, a Turkmen government official told Reuters on Tuesday.

The Central Asian country holds the world’s fourth-largest natural gas reserves but remains dependent on gas exports to China after Russia cut back gas imports in the past few years.

The TAPI project, supported by the United States and the Asian Development Bank, has been touted by Turkmenistan since the 1990s. But starting work on the pipeline has been delayed because of the problem of crossing Afghanistan.

The pipeline will allow Turkmenistan to find new consumers in Asia and cut its dependence China, which buys 30 billion cubic metres (bcm) of gas annually.

Russia, which imported more than 40 bcm of Turkmen gas in 2008, will buy no more than 4 bcm this year. Moscow says the development of gas fields elsewhere has made purchases of Turkmen gas unprofitable. Neighbouring Iran also buys small volumes of Turkmen gas.

State gas monopoly Turkmengas was selected in August to lead the TAPI pipeline consortium, named after the countries which it is designed to cross.

“Turkmengas ... plans to start building the TAPI pipeline in early December,” the official said on condition of anonymity. “The Turkmen stretch of the pipeline (to the Afghan border) will be built by a (Turkmen) oil and gas pipeline construction firm.”

Turkmengas will be joined by international energy companies at a later stage, the official said. He gave no further details.

It is expected that the construction of the pipeline will take three years, he said. The pipeline is designed to last for 30 years.

The 1,735 kilometre (1,084 mile) pipeline, with a proposed annual capacity of 33 bcm of gas, will run more than 700 km across Afghanistan on its way to Pakistan and India.

Turkmenistan plans to fill the pipeline with gas from its mammoth Galkynysh field, the world’s second-largest reservoir of natural gas.

Writing by Dmitry Solovyov; Editing by Christian Lowe and Jane Merriman

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