Iran rejects pricing offered by India and Pakistan

By agencies   |   Monday, 17 July 2006, 19:30 IST
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NEW DELHI: Terming India’s offer as "subsidized domestic prices, Iran has rejected India's demand for a price equivalent to international long-term gas supply contracts for the Iran-Pakistan-India pipeline gas. Iranian Oil Minister Kazem Vaziri-Hamaneh said "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 on.” While New Delhi is willing to pay only $4.2 per mBtu on Tehran’s demand of at least 7.2 dollars per mBtu price through the over 7 billion dollar pipeline, Iran had forwarded a gas pricing formula wherein the gas price is linked to Brent crude oil with a fixed escalating cost component (10 per cent of Brent crude oil). India and Pakistan have both set up requirements of 90 million standard cubic meters of gas per day and 60 mmscmd respectively, from Iran through the 2100-km long pipeline. Stating that New Delhi and Pakistan were opposed to linkage due to the lack of a floor and ceiling for the gas price, the official-level talks would be followed by a meeting of energy ministers of the three countries in Tehran to finalize modalities for implementation of the project.