Iran’s Economy & Finance Minister Davoud Danesh-Jafari saysTehranis ready to re-open and negotiate the contract.

“We will cover all aspects during the talks, including movement of LNG prices in the international market. But we will give good concessions toIndia,” Jafari said after the meeting with Indian Petroleum and Natural Gas Minister Murli Deora.

In June 2005, National Iranian Gas Export Company (NIGEC)signed a 25-year sales and purchase agreement with an Indian consortium for the supply of 5 million tonnes a year (t/y) of LNG.

The deal also involved granting upstream gas rights and oil concessions (MEED 27:5:05).

Iranlater claimed the contract was not ratified by its Supreme Economic Council, a required step before it could be formally approved by NIGEC’s parent company, National Iranian Oil Company.

The three original Indian companies are still expected to proceed with the deal. Under the 2005 agreement, Gail was to take 40 per cent of the product, with Indian Oil Corporation claiming 35 per cent and Bharat Petroleum Corporation the balance.