Press Information Bureau
Government of India
Ministry of Petroleum & Natural Gas
26-April-2012 16:31 IST
Broad Understanding on Transit fee for Import of Natural Gas from Turkmentistan Through TAPI Pipeline
A broad understanding among India, Pakistan and Afghanistan has been arrived on transit fee for import of natural gas through Turkmenistan – Afghanistan – Pakistan – India (TAPI) Pipeline Project. “However a formal Agreement has not been signed”, Shri R.P.N. Singh, Minister of State for Petroleum & Natural Gas said this while replying to a question in the Lok Sabha today

He added that the pricing of gas has been agreed between Turkmenistan and India. The contract price of TAPI gas is linked to a formula which contains indices based on fuel basket and other indices which are not as volatile as crude oil. The formula is similar to the ones used in international contracts. The Minister, however, informed the House that the Gas Sale & Purchase Agreement (GSPA) relating to the TAPI Pipeline project, which includes inter alia the pricing of Turkmen Gas has not been signed.

Replying to another query, Shri Singh said that at present, there are broadly two pricing regimes for gas in the country – gas priced under Administrative Pricing Mechanism (APM) and non-APM. The price of APM Gas is set by the Government. As regard non-APM domestic gas, it is produced from New Exploration Policy (NELP) and pre-NELP fields. The pricing of NELP and pre NELP- gas is governed in terms of the Production Sharing Contract (PSC) signed between the Government and the Contractor.