NEW DELHI: Petroleum and Natural Gas Minister Murli Deora on Wednesday met Iranian Oil Minister Seyed Kazem Vaziri Hamaneh and Pakistan's Petroleum Minister Amanullah Khan Jadoon in Riyadh, Saudi Arabia, in an attempt to narrow down the differences on the issues relating to the $45 billion Iran-Pakistan-India natural gas pipeline project.

At the meeting with the Iranian Minister, on the sidelines of the Second Ministerial Energy Roundtable of Asian Oil Producing and Oil Importing Countries in Riyadh, Mr. Deora discussed the vexed issue of the Liquefied Natural Gas contract as a follow-up of their last meeting in Tehran last week.

He is understood to have touched upon the issue of increase in price sought by Tehran for the natural gas supply for which an agreement was signed in June 2005.

Mr. Deora told Mr. Vaziri Hamaneh that India was ready to buy the additional gas at a higher price but the June 2005 agreement for supply of 5 million metric tonnes of gas should be honoured.

Mr. Deora also met Mr. Jadoon and both leaders are understood to have discussed the issue of transportation and transit fee that is being demanded by Pakistan for supply of gas to India. He had a bilateral meeting with Iraqi Oil Minister Hussain Al-Shahristani and raised the issue of moving forward with ONGC Videsh Limited's participation in Iraq's upstream oil sector.

The Iraqi Minister invited Indian Oil Corporation and Engineers India Limited to consider participation in the downstream sector of Iraq, in particular for the construction of an oil refinery.

Sustainable prices

Earlier, addressing the Ministerial meeting on energy, Mr. Deora called upon the Asian countries to explore the possibility of forging partnerships in the oil and gas sectors. This, he said, was required for optimum exploration of hydrocarbons, expansion and modernisation of the refining infrastructure, augmentation of regional oil and gas transport infrastructure.

Mr. Deora also stressed the need for sustainable international oil prices stating that the high oil prices were neither in the interest of oil importing countries nor beneficial to the exporting nations.

Referring to the three-fold increase in global oil prices between 2000 and 2006, Mr. Deora said high prices in the long run would adversely impact both oil producing and importing countries.

High oil prices led to a fall in demand by encouraging conservation and technological innovations and made alternative investment for energy attractive besides putting strains on the resources of oil importing developing countries.

He called for evolving appropriate policy reforms and practical measures to ensure that prices remained stable and affordable in the long run. He also strongly supported the idea of greater inter-dependence, supplemented by cross investment in energy markets to promote shared interest of energy producers and consumers.

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