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India expected to approve TAPI pipeline

May 18, 2012 at 7:04 AM   |   Comments

NEW DELHI, May 18 (UPI) -- India's state-owned utility company GAIL is expected to sign an agreement next week on a natural gas pipeline planned from Turkmenistan, the government said.

The Cabinet announced that Gas Authority of India Ltd. is permitted to sign a gas sale and purchase agreement with Turkmenistan's national energy company TurrnenGas early next week, The Economic Times of India reports. The GSPA is for natural gas from the Turkmenistan-Afghanistan-Pakistan-India natural gas pipeline.

The United States backs the Turkmenistan-Afghanistan-Pakistan-India natural gas option over an Iranian plan to move gas from the South Pars field in the Persian Gulf.

The Cabinet decision follows a visit to India by U.S. Secretary of State Hillary Clinton who said she won assurances from New Delhi that it would lower the amount of crude oil it purchases from Iran.

Iran is suspected of funding a controversial nuclear program with oil revenue.

Unidentified officials were quoted by the news service as saying natural gas from Turkmenistan would cost less than importing liquefied natural gas from Qatar once TAPI enters into service in the next few years.

TAPI has the backing of the Asia Development Bank.

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