LNG import from Iran being pursued, Govt

New Delhi, Aug 1: India is currently pursuing the import of LNG with Iran's government and it is understood that the Iraian procedures recquired to be completed for the approval of the Sale Purchase Agreement (SPA) have not been finalised yet, the Rajya Sabha was informed today.

A SPA for the purchase of 5 million metric tonnes per annum (MMTPA of LNG was signed between GAIL/ Indian Oil Corporation (IOC), Bharat Petroleum Corporation Limited (BPCL) and National Iranian Gas Export Company (NIGEC) on June 13, 2005 in Tehran.

In a written reply to the Rajya Sabha, Minister of State for Petroleum and Natural Gas Dinshaw Patel said the contract period is 25 years, beginning from the last quarter of 2009.

To thrash out the vexed price issue plaguing the 7-billion dollar Iran-Pakistan-India (IPI) gas pipeline project, oil secretaries of Iran and India is also scheduled to meet.

The meeting will try to redress India's price formula which Iran had earlier rejected.

The pipeline project scheduled to deliver the fuel to South Asian countries including India hit a roadblock with Iran rejecting the price set by India.

The news agency PIN of the Iranian Oil Ministry, quoted Iran Oil Minister Kazem Vaziri-Hamaneh who termed the Indian offer as based on ''subsidised domestic prices''.

He said Teheran will not sell its gas at the proposed price.

Iran is asking for at least 7.2 dollar per mmbtu while New Delhi has quoted a price of 4.2 dollar per mmbtu for the gas delivered at its border. Tehran's price is also subject to a three per cent annual escalation.

The statement comes in close to the Teheran meet, where oil secretaries of the three countries-- Iran, Pakistan and India will meet on August 3-4. The scretary level talks would be followed by a meeting of energy ministers of the three countries in Tehran to finalise modalities for implementation of the project.

''If the Indian side is not ready to buy our gas at its real price, we have no obligation to sell it at the price lower than the real one,'' Mr Vaziri-Hemaneh was quoted in the PIN.

The main agenda of the Oil secretaries meet at Tehran is to resolve the impasse over pricing of natural gas that Tehran wants to sell to India and south Asian countries.

The last meeting of oil secretaries of the three countries in Islamabad on May 22 and 23 broke off after Iran sought a price linked to international crude oil for the natural gas it wants to sell to India and Pakistan.

Iran's gas pricing formula is linked to Brent crude oil with a fixed escalating cost component (10 per cent of Brent crude oil).

The price is more than 50 per cent above the prevailing market- determined gas price in India, according to Indian officials.

India wants to import 90 million standard cubic meters of gas per day (mmscmd) from Iran through the 2,100 km-long pipeline while Pakistan has indicated a requirement of up to 60 mmscmd.

Apart from the Brent linkage, the Iranian formula does not prescribe a ceiling for the gas price. New Delhi has opposed to this formula and even Pakistan is understood to have rejected it.

UNI