The Malaysian government will consider the possibility of its companies’ participation in realizing the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project. Such an announcement was made by the country’s Prime Minister following talks with the President of Turkmenistan this week.
Turkmenistan is actively looking for investors into the project. Earlier, the country’s president Berdimuhamedow invited counterparts from Qatar, Saudi Arabia, Germany and other countries to partake in the pipeline’s construction. However, not many expressed their willingness due to obvious geopolitical and economic risks associated with the project. Transit of natural gas through countries with unstable political situations in a low pricing environment makes the prospects of TAPI somewhat doubtful.
However, the project is of great importance to Turkmenistan. The low-price environment is bound to end at some point, and the Hermit Kingdom wants to meet the period of market stability with a functioning infrastructure capable of ramping up gas exports. With a good amount of effort, Turkmenistan did manage to find a source of financing – the Islamic Development Bank agreed to sanction $700 million for the pipeline’s construction.
Aside from expansion southwards, Turkmenistan is also involved in negotiations with Azerbaijan, Turkey, Georgia and the European Commission on the prospects of exporting from 350 to 1,000 billion cubic feet of natural gas to EU-member countries.
Nevertheless, TAPI isn’t the only Malaysian interest in Turkmenistan. Petronas is among the most valued partners of Turkmenistan and President Berdimuhamedow is often seen discussing future collaborations with the company’s CEO. At the same time, Petronas considers the development of Turkmenistan’s Caspian Sea oil and gas reserves one of its top priorities and is aiming for further cooperation. Currently, the company operates four oil and gas offshore platforms in the Turkmen part of the Caspian Sea. The Malaysian company’s overall contracted territory is confirmed to hold no less than 35 trillion cubic feet of natural gas, 200 million tons of crude oil and 300 million tons of natural-gas condensate.