Iran hopes to finalize India pipeline deal in June

TEHRAN, May 29 (Reuters) Iran said today it hopes to sign a final deal next month for a 7 billion dollars pipeline that transfers natural gas to India through Pakistan, Iranian media reported.

The three countries agreed over the price formula for the pipeline in January and a new round of negotiations started in Tehran on Sunday.

''We hope that in this meeting we would be able to prepare the ground to ... finalize the deal on June 30,'' senior Iranian energy official Hojatollah Ghanimifard was quoted as saying by the ISNA news agency.

He did not say which issues remained to be settled.

The pipeline, known as the ''peace pipeline'', aims to feed the growing energy needs of the subcontinent but has made slow progress due to political tensions between India and Pakistan and differences between New Delhi and Tehran over the latter's controversial nuclear programme.

Washington accuses Tehran of using its nuclear programme as a cover to build atomic weapons and has repeatedly sought to discourage India from the project. Iran denies the charges.

''For carrying out and making this project a reality, India would in no way be influenced by other countries including America,'' Iranian news agencies quoted India's representative at the talks, S. Sunderashan, as saying.

Iran sits atop the world's second-largest gas reserves after Russia. But sanctions, politics and construction delays have slowed its gas development and analysts say it is unlikely to become a major exporter for a decade.

Apart from the pipeline, New Delhi is also negotiating with Iran to secure a deal that would see Tehran supply 5 million tonnes of liquefied natural gas a year over a 25-year-period from 2009.

REUTERS RJ KP2114