The Hindu : National : LNG deal not possible: Iran

Online edition of India's National Newspaper
Wednesday, May 03, 2006

National

National

LNG deal not possible: Iran

Special Correspondent

New Delhi: Iran has said that the long-term contract for importing 5 million tonnes of LNG over 25 years with India is "not implementable". According to the visiting Deputy Oil Minister of Iran, Hadi Nejad Hosseinian this is because the deal has not been ratified by his country's Supreme Economic Council.

The contract which concluded in June last year was signed between the National Iranian Gas Export Company (NIGEC) and three public sector companies - Indian Oil Corporation, GAIL India and Bharat Petroleum Corporation Limited.

Mr. Hosseinian also said the deal raised several issues though he did not elaborate on them. He stressed, however, that since the contract has not been ratified, it was not implementable.

Indian officials, however, maintain that Iran is seeking a higher price for the LNG but

India is not willing to renegotiate the contract. Besides they point out that the contract was meant to be approved by NIGEC's parent company, the National Iranian Oil Company (NIOC).

He said the proposal for the Iran-Pakistan-India gas pipeline project will also have to be endorsed by the Supreme Council even after the three countries sign an inter-governmental agreement in June. He told newspersons that Iran has set July as the deadline to sign the deal for the pipeline project. If it fell through, his country would then pursue the option of bilateral exports to Pakistan.

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