TAPI Pipeline: Turkmenistan Secures Afghanistan as Its First Gas Customer
Central Asia Column “Steppe Ahead” — Author: Thomas Baier
On August 10, Turkmenistan and Afghanistan signed the first purchase agreement for gas from the TAPI pipeline. The state-owned company Türkmengaz and the Afghan state-owned company Afghan Gas signed a memorandum of understanding in the border town of Torghundi regarding the price, volume, and distribution of future deliveries. The first section of the pipeline, from Serhetabat to Herat, already spans 123 kilometers. Once fully operational, the pipeline is expected to deliver 33 billion cubic meters of gas per year to Afghanistan, Pakistan, and India.
Memorandum of Understanding Sets Price, Volume, and Distribution
Turkmenistan’s National Leader Gurbanguly Berdimuhamedov and Afghanistan’s Deputy Prime Minister for Economic Affairs, Abdul Ghani Baradar, witnessed the signing. According to the Chinese state news agency Xinhua, the document addresses three points: the gas price, Afghanistan’s purchase volume, and distribution within the country. Baradar pushed for a pricing formula that would shield Afghanistan from fluctuations in the European gas markets. This was reported by News Central Asia (nCa), a news portal specializing in the region. According to nCa, he called for “a long-term gas agreement with simple terms and a flexible mechanism for contract review.” Both sides also established a technical committee. It is tasked with overseeing TAPI, a power transmission line, as well as fiber-optic and rail projects. A second agreement concerns a natural gas distribution network in Herat Province. It is intended to connect industrial facilities and households—thereby creating significant domestic demand for the first time. The TAPI project dates back to the 1990s. Wars and financing issues have repeatedly halted it. The planned route spans more than 1,800 kilometers and ends in Fazilka, India. A firm purchase agreement with Kabul would secure paying customers for the project for the first time.
Construction Progress: 123 Kilometers in Ten Months
According to nCa, 123 kilometers have been laid on the section from Serhetabat to Herat, with another 30 kilometers under construction. Around 300 specialized machines and more than 120 workers are on the job. The pace has picked up significantly. In October 2025, the U.S. industry portal Eurasianet reported that only 14 kilometers had been laid on Afghan soil. Turkmenistan and the Taliban government had restarted construction of the Afghan section in September 2024. For Kabul, this is about more than just self-sufficiency: Eurasianet estimates potential transit revenues upon full completion at over $1 billion per year. According to nCa, Baradar stated that the remaining work in Herat is on schedule. The pipeline is part of a larger corridor project. In Torghundi, both sides also discussed reviving the Lapis Lazuli Corridor to Azerbaijan, Georgia, and Turkey. This includes the expansion of the Herat–Torghundi railway line and the reopening of the Aqina border crossing for oil shipments. Berdimuhamedov proposed a joint economic commission and unified logistics centers. Turkmenistan is thus positioning its Caspian port of Turkmenbashi as a hub for trade with Afghanistan.
A Way Out of Dependence on China—and Opportunities for German Suppliers
For Ashgabat, the agreement is above all a signal of diversification. Until now, gas exports have depended almost entirely on China. According to China’s Ambassador Ji Shumin, Turkmenistan supplied approximately 30 billion cubic meters to China in 2025, as reported by the energy portal OilPrice.com. Ashgabat itself cites 40 billion cubic meters—a discrepancy of about 25%. The business is lucrative: According to Eurasianet, exports to China generated $2.4 billion in the first quarter of 2024 alone. However, the three existing pipelines to the east are designed for 55 billion cubic meters and are operating well below capacity. The planned fourth pipeline to China (Line D) has been on hold since 2014 due to a price dispute. As a de facto monopoly customer, Beijing dictates the terms. TAPI would be the first major sales channel to the south. At the same time, official statistics report growth: According to the Times of Central Asia, an English-language regional media outlet, GDP officially rose by 6.3% in the first half of 2026, while foreign trade increased by 7.5%. The IMF considers the official data to be largely unreliable and expects growth of only 2.4% in 2026. For German exporters, actual construction progress matters more than a letter of intent. Compressor stations, valves, measurement and control technology, and large-diameter pipes are being put out to bid on the Turkmen side—a challenging but sanctions-free market. Financing for the sections in Pakistan and India, however, remains unresolved. In the short term, only the first phase to Herat is realistic. Suppliers must be disciplined about advance payments, have local partners, and exercise patience with Turkmen state-owned enterprises. The reward: a gas market that, after decades of being a one-way street toward China, is opening a second door for the first time.
Source: nCa, nCa (Herat), Xinhua, Eurasianet, OilPrice.com, Times of Central Asia (all EN)