Indian officials have sought to downplay the significance of a memorandum of understanding signed between Iran and the Russian company Gazprom on the development of the Farzab B gasfield, saying they have not heard of a final deal and talks with Tehran were on as recently as last week.
The 12.5-trillion-cubic feet gasfield was discovered by ONGC Videsh Ltd., the overseas arm of the State-run ONGC, but Tehran has delayed the award of right to develop the field to the company, reportedly disappointed with its commitment of $3 billion and the time it was taking to finalise the terms.
Iranian Oil Minister Bijan Namdar Zanganeh confirmed the signing of the agreement with Gazprom. However, Indian officials remain confident about OVL’s chances.
ADVERTISEMENT
“What has come out in the media is not our understanding,” said Sunjay Sudhir, Joint Secretary, International Cooperation Division in the Petroleum and Natural Gas Ministry. “ONGC Videsh has been in negotiations with the NIOC [National Iranian Oil Company] as late as last week in Tehran.”
Negotiations between India and Iran have reportedly heated up, with India cutting oil imports from Iran and Iran retaliating by reducing the credit time limit it gives Indian companies from 90 to 60 days.
The agreement was meant to be concluded last November, but the two countries mutually agreed to push it to February 2017.
ADVERTISEMENT
“It is only in the press that it has gone to Gazprom, but not our information since we are in touch with the Iranians closely,” an official in the Ministry said on condition of anonymity. “Three months ago, they had signed an MoU with Gazprom, but we have no word that the final deal was done. The procedure to award such blocks is not of just handing it over. A lot of calculations have to be made and processes have to be followed.”
No more delays
External Affairs Minister Sushma Swaraj recently acknowledged the slow pace of movement on closing deals in Iran, which include the Farzan B gasfield and the Chabahar port.