Indian Oil Corporation and Gail (India) Ltd have submitted bids for the construction of the $2.5 billion Turkmenistan-Afghanistan-Pakistan pipeline, which will move natural gas from Turkmenistan's Dauletabad fields via Afghanistan to Pakistan's Multan.

While IOC has tied-up with the Russian construction firm Stroystransgaz, Gail has roped in Gazprom, also of Russia, for putting in the joint bid.

Gail chairman and managing director Proshanto Banerjee said, "We have expressed interest in designing, construction, operation and maintenance of the proposed pipeline to the Asian Development Bank."

The two Indian state-run firms will possibly face Petronas of Malaysia in September when the contract is expected to be awarded.

The part-ADB-funded pipeline would move up to 30-billion cubic metre gas per year from Turkmenistan to Afghanistan, Pakistan and possibly India. Construction on the pipeline is scheduled to begin by early 2004.

Banerjee, however, ruled out the extension of the pipeline to India as New Delhi continues to have security concerns on the safe delivery of gas owing to the 'instability' in Afghanistan.

Pakistan, Afghanistan and Turkmenistan have invited India to join the project but New Delhi has not yet accepted the offer.

India's participation in the project is vital as it has the biggest natural gas market, which would make the pipeline profitable.

"We will only be constructing the pipeline and are not associated with gas marketing," he said.

The pipeline from the world's fourth largest gas field in Dauletabad in south-east Turkmenistan will pass through Herat/Kandahar in Afghanistan to Quetta-Multan in Pakistan covering 1650 km.

The proposed pipeline, which will also be extended to the Arabian sea ports in Pakistan for shipment of gas to other Asian markets, will take three years to build, Banerjee said.

ADB has awarded the United Kingdom engineering consultancy Penspen the techno-economic feasibility study for the project.

Banerjee said the plan is to transport gas produced in the established Dauletabad field to the under-supplied markets in Afghanistan and Pakistan.

Afghanistan would benefit from the transit fee and from potential offtakes to its own gas markets, he said, adding the study is expected to take five months for completion.