Tehran agreed an initial memorandum of understanding last June with Muscat for the supply of gas from the two fields to Oman’s Qalhat liquefied natural gas plant.

The National Iranian Gas Export Company said on 22 January that it had set up a working group with Omani officials to conduct a further feasibility study examining the financial and technical details of any future deal.

Iran said a further round of bilateral talks will be held within the next few months.

Oman has a desperate need for more gas. Demand in the sultanate is forecast to reach 3.8bn cubic feet a day (cf/d) by 2010, well above the planned supply of 2.6bn cf/d, according to the Ministry of Oil & Gas.