labels: oil & gas
Iran threatens to exclude India from Iran - Pakistan - India gas pipeline dealnews
27 September 2007

Mumbai: Iran has threatened to sign a gas pipeline deal with Pakistan alone if India did not conclude transit pricing agreement with Islamabad soon, even as India remained absent at the ongoing secretary-level talks on the project.

India, however, said it remained committed to the deal despite not attending the current round of talks in Tehran.

Discussions on the $7.4-billion project, which would bring Iranian gas to India via Pakistan, have been held up over technical and commercial issues.

Officials from Iran and Pakistan are currently holding a new round of talks aimed at finalising the long-delayed pipeline.

India remained absent at the talks as New Delhi and Islamabad have failed to arrive at an agreement over the payment of transit fees by India to Pakistan.

"We prefer it to be a tripartite deal, but if it does not happen we will sign it with the Pakistanis," caretaker oil minister Gholam Hossein Nozari said, adding that the door is still open to India.

India and has reached a broad understanding with Pakistan over a separate transportation fee payable to Pakistan for wheeling natural gas through a 1,035-km pipeline segment in that country, but they are yet to conclude an agreement.

India said it would not attend the secretary-level meeting in Tehran unless the transit fee issue was resolved with Islamabad.

The United States, which is at loggerheads with Iran over its alleged nuclear weapons programme, has been objecting to the pipeline. But Indian authorities say that has nothing to do with the current impasse.

The 2,600-km pipeline from Iran''s giant South Pars gas field would initially carry around 60 million standard cubic metres (2.2 billion cubic feet) of gas per day.

Iran has the world''s second largest gas reserves after Russia but until now has remained a relatively minor player in the global export market.

Despite skipping a crucial tri-nation talks, India has expressed the hope that the Iran-Pakistan-India gas pipeline will become a reality if buyers and the seller agree on the fuel price.

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Iran threatens to exclude India from Iran - Pakistan - India gas pipeline deal