Bahrain stalls Iran gas deal

24 May 2011

Gas import deal on hold due to political interference from Tehran

Bahrain has a put its agreement to import gas from Iran on hold due to an ongoing political rift between the two countries.

Bahrain Minister of Foreign Affairs Shaikh Khalid al-Khalifa said on 21 May that the Kingdom has frozen the gas import agreement with Iran until further notice, citing “Iran’s blatant interference in the kingdom’s domestic affairs”, according to a statement on the state-run Bahrain News Agency.

He said Iran’s successive provocative statements will affect agreements between the two countries, stressing that such projects require more suitable political atmosphere.

However, Al-Khalifa added that the agreement had not been cancelled altogether, but required a more suitable political atmosphere.

Bahrain and Iran signed a memorandum of understanding in late 2007, to import 1 billion cubic feet of natural gas per day (cf/d), although details of pricing and the construction of a pipeline were not finalised (MEED 21:11:07).

In June last year, Iran said it expected to finalise an agreement, which would see Bahrain invest in the development of the Iran’s South Pars gas field in the Gulf which contains some 500 trillion cubic feet.

The kingdom is the only GCC state to import oil and is also being stretched in terms of securing gas supplies.

Bahrain produces about 1 billion cf/d of gas, but is expected to need up to 2.5 billion cf/d within the next decade.

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