[NEWSLETTER] 30Th June 2018 Afghanembassyturkmenistan.Com
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2018 EMBASSY OF ISLAMIC REPUBLIC OF AFGHANISTAN TURKMENISTAN [NEWSLETTER] 30th June 2018 AfghanEmbassyTurkmenistan.Com Content: Global snags necessitate LNG import, SC informed ....................................................................................................... 2 TAPI gas pipeline facing funding issues........................................................................................................................... 3 Can the Taliban be trusted to protect Afghanistan’s big bet on a gas pipeline? ........................................................... 4 Pakistan, Turkmenistan interested in early implementation of TAPI .............................................................................. 7 TAPI to contribute to energy security in region: Turkmen president ............................................................................. 8 Reference information on sources used ........................................................................................................................... 9 1 Global snags necessitate LNG import, SC informed The Express Tribune (Pakistan) – June 28, 2018 The federal government, while justifying the Liquefied Natural Gas (LNG) project, on Wednesday told the Supreme Court that Turkmenistan-Afghanistan-Pakistan-India (TAPI) and Iran-Pakistan (IP) gas pipeline projects could not be undertaken on account of global and regional political, economic and security issues that were beyond the control of Pakistan. “In the wake of this situation, the import of LNG appears to be the most viable solution to meet the energy deficit,” says the interim report submitted by the Ministry of Energy (Petroleum Division). It was also told that a comprehensive report will be submitted after the receipt of response from various stakeholders to whom letters have already been sent. The report states that Pakistan is an energy-deficit country where demand outstrips supply that has adversely affected the economic growth of the country. It adds Pakistan has been endeavoring to increase indigenous production through extensive exploration development and production by offering globally competitive market incentive by promulgation of various petroleum policies. “However, indigenous resources are not sufficient to meet the energy demand; therefore, there is a need for imported energy for sustainable economic development of Pakistan.” It is also submitted that in the past attempts were made for the import of LNG on an integrated basis, i.e., the onus to develop the terminal and other allied infrastructures would be on suppliers. However, the government decided to follow an ‘unbundled approach’ with separate contracts for the LNG procurement and regasification rather than an integrated approach to import LNG. The report says that tolling charges of the terminal was determined on the basis of a competitive bidding process undertaken by Inter-State Gas System (ISGA). The tender process was approved by the boards of ISGA and SSGL, the report said. Deputy Attorney General Nassar Mirza on Wednesday requested a three-judge bench headed by Chief Justice of Pakistan Mian Saqib Nisar to give three weeks to submit a comprehensive report in the petition filed by journalist Asad Kharral. The applicant contended that Ogra being a competent forum was ignored to decide/notify LNG prices. “Twenty shipments of LNG were procured on spot without the government-to-government agreement.” 2 He also alleged that the Port Qasim Authority first objected to the project because of congestion at the port but mischievously agreed and are being paid $13 million per year for only four tugs, that they had rented to the OLNG FRSU. The hearing of the case was adjourned for three weeks. Interestingly, the Supreme Court on February 11 rejected a petition filed by Awami Muslim League (AML) chief Sheikh Rashid, seeking disqualification of former prime minister Shahid Khaqan Abbasi over alleged corruption in the award of the LNG import contract. After initial arguments of Khosa, the bench observed that the case did not fall under the preview of Article 184(3) of the Constitution. https://tribune.com.pk/story/1744431/1-global-snags-necessitate-lng-import-sc-informed-2/ TAPI gas pipeline facing funding issues Dispatch News Desk (Pakistan) – June 24, 2018 Turkmenistan-Afghanistan-Pakistan-India — TAPI gas pipeline project is still facing funding issues although the financial closure of this $10 billion project in scheduled before the end of this year. A United Nations Development Program (UNDP) report indicates that the traditional approaches to public- private partnerships may not fully cover the framework of this project. TAPI project has deep geopolitical interests as it was launched as in 1995 to keep Iran and Russia away from energy markets of central Asia and South Asia. TAPI was introduced by NATO allies through international lenders as competitor to Iran Pakistan India (IPI) Gas Pipeline project but India withdrew from IPI in 2009 over the alleged pressures of United States while Pakistan avoided to announce its separation from IPI but halted the project for indefinite period due to perceivable pressures from United States although Iran completed its pipeline from pumping point to border of Pakistan. The 1,814-kilometer long TAPI pipeline will go through war-ridden Afghanistan and will reach India from Turkmenistan. The Turkmen section of TAPI began to be built in December 2015, and the Afghan section was initiated in February 2018. War is continuing in areas from where TAPI Gas Pipeline will run through Afghanistan and security of the project is hampering the interests of foreign investors. 3 Asian Development Bank promised over $1 billion for this project worth $10 billion and discussion with international credit agencies like SACE, Hermes and ECIO are in progress for financial closure of this project before the end of year 2018. It is pertinent to mention that a road show is being organized soon to showcase TAPI for finding investment for this project without delay. Turkmenistan has already completed its part of construction of Pipeline. Turkmenistan is in dire need to sell its gas to Afghanistan, Pakistan and India through TAPI because the biggest buyer of Turkmen gas— Russia completely stopped buying gas from Turkmenistan in 2016. TAPI project has an interesting history since the days it was conceived as US backed project to keep Iran and Russia from energy market of Central Asia. The original project started on March 15, 1995 when an inaugural memorandum of understanding between the governments of Turkmenistan and Pakistan was signed and soon an Argentinean company Bridas Corporation initiated work on the project but Bridas was replaced with U.S. company Unocal (in conjunction with the Saudi oil company Delta) by Pakistan due to alleged pressure from United States. Unocal withdrew from the project on December 8, 1998 and the project went into cold storage. According to latest map, TAPI pipeline will be constructed alongside the Kandahar–Herat Highway in western Afghanistan, and then via Quetta and Multan in Pakistan. The final destination of the pipeline will be the Indian town of Fazilka, near the border between Pakistan and India. https://dnd.com.pk/tapi-gas-pipeline-facing-funding-issues/143558 Can the Taliban be trusted to protect Afghanistan’s big bet on a gas pipeline? Stars and stripes (USA) – June 23, 2018 The Afghan government has completed some of the first steps on a $10 billion natural gas pipeline project so potentially lucrative that the Taliban have promised their support. The proposed 1,127-mile TAPI natural gas pipeline, named for Turkmenistan, Afghanistan, Pakistan and India — the four partner nations in the project — may deliver as much as $400 million a year to the Afghan government through transit fees. The pipeline is one of Afghan President Ashraf Ghani’s highest priorities and a big part of his plan to reduce the country’s reliance on the United States and other nations. But financial and security hurdles await the fledgling 4 pipeline, including funding concerns and a proposed pipeline route that will run through Taliban-contested provinces. “This is the big question for the Taliban: ‘Can it let the Kabul government have this win?’” said Michael Kugelman, a South Asia specialist at the Woodrow Wilson International Center in Washington. “I don’t know if the Taliban would let this project move forward. If they see the Kabul government as illegitimate, why would they support any project that would help that government?” Two competing Taliban factions in western Afghanistan pledged to local media to prevent disruption and to convince people to support the pipeline, but that was before gunmen killed six surveyors working on the pipeline in Kandahar on May 21. A Taliban spokesman in a message to Stars and Stripes denied responsibility for the attack. Taliban groups in the past have pledged to protect infrastructure elsewhere but have then attacked electricity pylons, schools and roads. The Taliban are decentralized, and it’s unclear how much control leaders have over their affiliated groups. Survivors of the Kandahar strike said one Taliban group promised not to attack them, but then another group attacked anyway, said Khalid Pashtoon, a member of parliament representing Kandahar. Another official said the government was investigating whether the incident was a Taliban attack or the result of an internal feud. The Afghan government plans to defend the pipeline construction with three Afghan