Iranian team in Delhi for talks on SPA and pipeline

Vol 9, PW 3 (18 May 05) People & Policy

A high level Iranian delegation is visiting India from 19th to 23rd May for more talks on the proposed Iran to India overland gas pipeline and the GAIL-led proposal to import 5m t/y LNG from Iran for 25 years.

Rokneddin Javadi, Managing Director, National Iranian Gas Export Company (NIGEC) will join the delegation in Delhi after a few days. Javadi and his team will be here for a dual purpose, a source tells this report.

They will meet GAIL officials to finalise the SPA (Sale Purchase Agreement) for the LNG contract and ministry officials for the (overland gas) pipeline. High on the agenda for the pipeline talks is the appointment of an international consultant to study the price of gas sold by Iran to India and Pakistan.

We have told NIGEC that India is interested in initial imports of about 60m-70m cm/d of gas, he said. But the exact quantity is linked to the price.

Every additional dollar will influence Indias decision. India is telling Iran that its demand for gas would reduce with an increase of every dollar in the buying price.

Pakistan is expected to take about 30m-50m cm/d. We may hike our requirement after three to five years of supply if gas is available at the right price.

During earlier meetings in Tehran between 2nd and 5th May, India told Iran it wants lean gas for power projects in Rajasthan, Punjab, Haryana and Uttar Pradesh. Under discussion were 24 technical options submitted by GAIL on pipeline specifications.

GAIL made a presentation offering several technical options right from pipeline size to the quality of pipes. In this weeks meeting in Delhi, both sides will try to reach consensus on the jurisdiction of the pipeline.

Iran wants the pipeline to be governed either by its own law or French law. Delhi wants to apply English law.