The Asian Development Bank (ADB) has approved a $700,000 technical assistance grant for a study to locate area for construction of natural gas reservoirs in Pakistan in the event of supply disruptions in the planned -Turkmenistan-Afghanistan-Pakistan (TAP) gas pipeline project.
The TAP natural gas pipeline project is a 1,700km pipeline that will transport up to 30 billion cubic meters of natural gas annually from the Daulatabad fields in South East Turkmenistan to consumers in Afghanistan, Pakistan, and possibly to India.
The $ 3.3 billion project, to take five years, will begin after the countries involved and other partners would finalise various project agreements.
Underground reservoirs are proposed for Pakistan to store sufficient quantities of natural gas in case of any disruption - for example, through political action or sabotage - of supply through the pipeline.
"The gas demand in Pakistan, particularly in the north, is subject to major seasonal variations," the ADB statement said. "During winter, gas supply is limited because of the increased demand for power generation for domestic heating.
The situation is aggravated by reduced hydropower generation. Underground storage would help in preventing such shortages."
The technical assistance will identify possible reservoirs based on size, containment capacity, productivity, and location.
The short-listed reservoirs will undergo a more detailed evaluation. Other facilities needed to integrate the reservoirs with the gas infrastructure will also be evaluated. Cost estimates and implementation schedules to develop and integrate the selected reservoirs will be prepared.
The technical assistance will also provide legal advisory services to help the governments in finalising various project agreements, and disseminate information about the project among major oil and gas transportation companies to facilitate bid solicitation.
The ADB has previously financed a techno-economic feasibility study for the pipeline project, a market study on demand for natural gas in Pakistan and northern India, and a risk analysis and risk mitigation study on concerns of consumers in case gas supply is disrupted. This assistance is a follow-up to the latter study.
The technical assistance is due for completion in October 2004. The Government of Pakistan will contribute $125,000 equivalent towards its total cost of $825,000.
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