FT: Dragon Oil Looks to Back $10bn Gas Link

Dubai-owned Dragon Oil is in talks to invest in a $10bn pipeline to deliver natural gas from Turkmenistan to India, a potential boost to the project after several western oil companies failed to secure a role.

The Tapi project has been delayed for years amid numerous challenges — including building a pipeline across war-torn Afghanistan — but is gathering pace as Turkmenistan, facing a plunge in revenues because of the oil price fall, seeks new customers for its natural gas.

Construction will begin next month, Turkmen officials told an oil and gas conference in the capital, Ashgabat, last week.

However, a search for a private-sector partner has so far proved fruitless: ExxonMobil, Chevron and Total dropped out amid declining oil prices and Ashgabat’s insistence on retaining rights to its onshore gas reserves, the world’s fourth largest. Turkmengas, the state company, was named as project leader this summer.

Faisal Rabee Al Awadhi, general manager for Dragon Oil in Turkmenistan, said the company had signalled its willingness to invest in Tapi. “This [discussions on Tapi] has been ongoing for a long time. But now it’s very serious, things have been signed between the countries. That’s why we have shown our interest to go in,” he said. MORE