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Iran hopeful of early resolution on gas supplies
Wednesday, 15 December 2004, 20:30 IST
NEW DELHI: Iranian Deputy Foreign Minister for Economic Affairs Ali Majedi Wednesday expressed optimism about an early resolution of issues holding up plans for gas supplies to India and Pakistan via a pipeline.
The upturn in the India-Pakistan relationship and the increasing energy needs of both countries to fuel their economic growth, Majedi said, are positive signals of an early resolution of issues holding up the gas pipeline linking Iran with the two countries.
Addressing a conference here on the Iran-India gas pipeline, Majedi admitted that "while certain technicalities still need to be addressed" on the security of supplies, improved relations between India and Pakistan have "moved us closer to a final settlement".
"I am optimistic on the pipeline. From our side we foresee no difficulties. While there are other alternatives for gas exports to the West we prefer to make more secure gas supply to this region," he said.
Mooting a four-point agenda for resolving the issues, Majedi said these could include financial guarantee, effectuation through two-way linkages and setting up a reservoir at the Indian border as precaution against any disruption in supplies.
"There are of course some security issues between India and Pakistan but India must look at this alternative."
"My country will try to make the best of the existing financial facility as well as others globally to help set up an international consortium to ensure supplies to both countries," he said.
The Iranian minister, who is planning to discuss the issue with his Indian counterparts during the visit, warned: "Any further delay will result in a costlier and less reliable alternative."
On liquefied natural gas (LNG) supplies, the minister admitted that pricing was an issue that would be taken up for further negotiations as both countries were looking at a long-term contract.
Holding the second largest gas reserves, Iran is keen to sell its gas to nearby markets in the Asian region even as it is getting more enquiries from European countries as also China.
To meet the increasing demand, Majedi said Iran is planning to raise its natural gas production to 3.20 billion cubic feet per day by 2005-10 from 2.5 billion cubic feet currently.
Iran's South Pars block, from where the country plans to supply gas to India and Pakistan, alone is estimated to have a gas production potential of up to 8 billion cubic feet per day (Bcf/d).
Discounting fears of any shortfall in oil production, Majedi pointed to the decision of the Organisation of Petroleum Exporting Countries (OPEC) to cut its oil production by one million barrels a day from Jan 1 to maintain present price levels of over $40 per barrel.
Source: IANS
Source: IANS