Deal on Iran gas field may be sealed by October

NEW DELHI,SPECIAL CORRESPONDENT:Oil Minister Dharmendra Pradhan announced a tentative deadline of October for the completion of talks with Iran regarding the development of that country’s Farzad-B gas project by a consortium of Indian companies and said the commercial terms are yet to be finalised.

The deal with Iran will see development of the Farzad-B field by an Indian consortium. File Photo: Reuters

“Iran has given an in-principle approval for the deal,” Mr. Pradhan told reporters during a press conference highlighting the achievements of his ministry in the last two years. “The price is yet to be settled. While they need a viable royalty amount, our companies also need a suitable economic incentive. We are trying to complete the talks by October.” The Farzad-B field, discovered in 2012, is estimated to have 21.68 trillion cubic feet (tcf) of gas reserves. The deal with Iran would see development of the field by a consortium of Indian companies led by ONGC Videsh, the overseas arm of state-run Oil and Natural Gas Corporation.

The Minister also said he welcomed the interest shown by international companies like Saudi Aramco and Total SA of France to invest in India. A license to sell fuel in India is subject to a company investing Rs 2,000 crore in oil and gas infrastructure, whether it is in refineries, exploration and production, pipelines or terminals. On queries about ONGC’s purchase of Gujarat State Petroleum Corporation (GSPC) assets in the Krishna-Godavari area, the minister said: “ONGC and GSPC are talking at their level. There is no problem in that. If they reach an understanding, then that is good,” Mr Pradhan said.

Unified guidelines
The Minister also unveiled the unified guidelines for the awarding of LPG distributorship. Under the new system, there will be four broad types of distributorships with varying refill ceiling limits – Sheheri (Urban), Rurban (a combination of rural and urban), Gramin (rural) and Durgam Vitrak (for hilly and difficult to reach locations).

The new guidelines also provide for a 33 per cent reservation of the licenses for women across all categories. “In this year, the oil marketing companies will start the process for selection of new distributors in 10,000 new locations,” Mr Pradhan said. He also said that his Ministry was in talks with the Finance Ministry for a single price for both the domestic as well as commercial usage of LPG. The minister highlighted some achievements of his Ministry over the last two years such as the Rs 30,000 crore of LPG subsidies directly transferred to beneficiaries’ accounts between January and May of this year. While India currently has an LPG consumption of 19 million metric tonnes, this is set to increase substantially.

“We have around 17 crore LPG consumers in the country. We estimate the total LPG consumer base to grow to 25 crore in the next few years, which will increase our LPG consumption.”

Posted by on June 4, 2016. Filed under Economy. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.