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Tehran warns Crescent to agree on gas prices
Iran is serious in its threat to use gas it planned to sell to Crescent Petroleum domestically if a long-running dispute with the UAE firm over price is not resolved, Iran's oil minister said yesterday.
- Reuters
- Published: 00:15 April 17, 2008
Tehran: Iran is serious in its threat to use gas it planned to sell to Crescent Petroleum domestically if a long-running dispute with the UAE firm over price is not resolved, Iran's oil minister said yesterday.
Iran and privately-owned Crescent, based in Sharjah, have been locked in negotiations about the price of gas exports from the Iranian offshore Salman field to the UAE since 2006.
The UAE needs gas from the $1 billion project to meet rising domestic demand from industry and power plants, but the deal became controversial in Iran after some politicians said the export price should be higher. "If the price is not corrected, the gas will not be delivered to them [Crescent]," oil minister Gholamhossein Nozari told a news conference.
"We are very serious and if no agreement is arrived, the gas will be transferred to the mainland for domestic use," Nozari said.
Negotiations
Iran has previously said it would use the gas at home or sell it to others if no deal is reached. Negotiations have continued despite Iranian talk of ultimatums.
Crescent in February said it had made progress on talks to resolve the dispute about pricing and volume for gas imports from Iran but had yet to reach a final agreement.
Crescent officials could not immediately be reached for comment yesterday.
As well as the pricing row, the deal has been delayed because Iran has yet to complete facilities to produce the gas. Nozari said in December those facilities were almost finished. Tehran has no pipeline from the offshore Salman field back to Iran and therefore limited options for domestic use.
Crescent had expected first deliveries of the gas in mid-2006. The initial agreement was for the supply of 600 million cubic feet per day.
Crescent's affiliate Dana Gas will process and transport the gas to utilities and industrial users in the UAE.
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