For India’s fast-growing economy, an energy shortage looms, and India has been in negotiations with Iran to buy LNG (liquefied natural gas) to feed the growth. As the restlessness of Hezbollah and Iran’s nuclear shenanigans ignite headlines, however, the deal seems to have reached an impasse:
India’s $20 billion (Dh73.56 billion) deal to buy liquefied natural gas, or LNG, from Iran over 25 years has run into trouble, Iran’s foreign minister was quoted as saying yesterday.
Separately, negotiations have reached a deadlock on another ambitious deal to build an India-Iran gas pipeline through Pakistan.
The two projects were billed as crucial solutions to ease India’s energy shortage as its economy grows at one of the fastest rates in the world.
Under one deal, Iran was to supply five million tonnes of LNG a year starting in 2009, according to the agreement signed last year.
Under the contract, the National Iranian Oil Company was to supply the gas from its massive South Pars gas field through three Indian state-owned oil firms.
However, the deal has become “a little bit complicated because of the changing of circumstances from the time when the contract and agreement [were] signed,” said Iranian Foreign Minister Manouchehr Mottaki on the New Delhi Television news channel.
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It may simply be a matter of pricing. However, it may also be that Iran is pulling back on natural gas exports the same way that some observers have suggested that Iran may pull back from oil exports — as a one-nation retaliatory sanction against the rest of the world.