GAIL of India has reportedly entered talks with Iran to put back on track the $22-billion LNG supply deal.
Due to sanctions Tehran never honoured the sale and purchase agreement from June 2005 for the supply of 5 mtpa of LNG, with a price of $3.215 per British thermal unit, which remained the cheapest deal ever signed by an Indian company, Press Trust of India informs.
With sanctions being lifted, GAIL informed it has revived talks with the National Iranian Gas Export Company to come through with the SPA.
The 2005 deal saw three Iranian companies GAIL, Indian Oil and Bharat Petroleum book 2, 1.75 and 1.25 mtpa of LNG respectively.
According to a GAIL official, Iran should finish the construction of an LNG export terminal before any deliveries can be made.
The official added that despite NIGEC not honouring the SPA, the deal remained enforceable under international law.
LNG World News Staff; Image: GAIL