Wednesday, June 21, 2006

Iran says will not sell gas at cheap rates to India, Pakistan

Iran will not sell gas at knock-down rates to India and Pakistan, a senior oil official said amid a pricing dispute in talks over a planned pipeline.

'The price suggested by India and Pakistan is almost half of the price we offered,' deputy oil minister Mohammad-Hadi Nejad-Hosseinian said on state radio.

'If the two governments intend to subsidize their domestic gas, there is no reason for Iran to pay this subsidy,' he added. READ MORE

The Iran-Pakistan-India gas project envisages a pipeline of about 2,600 kilometers that would help meet South Asia's growing energy needs.

The three countries, however, have been at odds over pricing.

Quoted by the Iranian oil ministry's Shana news agency, Nejad-Hosseinian said Iran is not desperate to sell its gas to India and Pakistan.

'The tripartite Peace Pipeline agreement is not an absolute obligation,' he said.

He also warned India and Pakistan that if the nuclear issue is resolved, other countries 'will be the first customers of our gas (and will pay) even better prices.'

The official also said there was disagreement with India and Pakistan over the amount of gas to be exported -- as Iran is unwilling to sell a large portion of its planned daily exports of 480 mln cubic meters to just two countries.

'We think it is better for us to have various customers,' he said.

The three sides held their last round of talks on the project in May.