Pakistan moves on gas pipeline funding

ISLAMABAD, Dec. 21 (UPI) -- The Pakistani government said it's approved a proposal to deliver funding to help support a multilateral natural gas pipeline stretching east from Turkmenistan.

An economic committee, chaired by Pakistani Finance Minster Mohammad Ishaq Dar, approved a proposal to set aside $200 million for the country's share in a company steering the Turkmenistan-Afghanistan-Pakistan-India, or TAPI, pipeline.

"The Economic Coordination Committee also approved release of $12 million out of this share for the preliminary works in four equal tranches starting from January 2016 as per the disbursement plan," the ministry said in a statement.

Turkmenistan is expected to send up to 1.1 trillion cubic feet of natural gas per year to Afghanistan, Pakistan and India for the next 30 years once the pipeline is completed. Hailed as essential for regional economic and energy development, the project has drawn Western support in a region where adversaries Iran and Russia play a dominant energy role.

Pakistan's aging infrastructure means the country lacks a reliable power sector. The Asian Development Bank described the status of the energy sector in Pakistan as "crippling."

The Pakistani government says the overall project should cost around $10 billion. Consortium leader Turkmenistan has agreed to cover about 85 percent of the costs.

Project leaders include Turkmengaz, the consortium leader and state-run gas company of Turkmenistan, and Indian energy company GAIL. Turkmengaz was named as the pipeline's consortium leader in August.

ADB was appointed as the transaction adviser for the pipeline in 2013.