(EnergyAsia, May 31 2012, Thursday) — India will pay an average US$13 per million BTU its natural gas imported from Turkmenistan through the US-supported TAPI pipeline due to start up in 2017.
The 1,700km line, named after the four countries that it links up, will tap the gas reserves of Turkmenistan for export to Afghanistan, Pakistan and India,
Last week, representatives of the four countries signed agreements for the sale and purchase of up to 90 billion cubic metres a year.
GAIL, India’s gas monopoly, signed the agreement to pay the equivalent of US$9.17 per million BTU at source (based on a 55% rate to a basket of crude oil of US$100 a barrel), and a total of US$3.83 per million BTU in transit and transportation charges.
While the final price is a record high for Indian consumers — three times what they are now paying for domestic supplies from Reliance Industries and ONGC — it is still far cheaper than the Asian spot price of over US$18 per million BTU that Qatar, the world’s largest LNG supplier, is charging.
Indian consumers will have to come to terms with the fast-rising cost of energy which will sharply boost the country’s inflation.