Price Key Factor in Gas Export Talks

Price Key Factor in Gas Export TalksPrice Key Factor in Gas Export Talks

The primary issue discussed with Iran's potential natural gas customers is the price, managing director of the National Iranian Gas Company (NIGC) said Wednesday.

"Iran is negotiating with several countries the export of natural gas," Alireza Kameli was quoted by Shana news agency as saying. "Reaching an agreement on duration of the contract and the volume to be exported wouldn't be an onerous task once an agreement is reached on price."

NIGC has reached agreement with several countries on gas prices, while negotiations are underway with others in this regard. The primary issue in Iran's gas negotiations is the price formula.

The European Union has initiated 'unofficial talks' with Iran for the imports of gas, Fars news agency reported, citing unspecified sources with the knowledge of the matter as saying. Some Caspian littoral states have also invited Iran to join in construction of pipelines designed to transfer Caspian gas to Europe, the report added.

Oil minister Bijan Namdar Zanganeh, however, said earlier in May that gas exports to Europe is not a priority given low prices in that continent, legal impediments as well as budgetary problems.

Iran holds the world’s second biggest natural gas reserves after Russia, which accounts for 17 percent of the world's proved reserves. Nevertheless, Iran is currently a relatively minor and strictly regional exporter of natural gas via pipelines to three neighboring countries – Turkey, Armenia, and Azerbaijan. Despite its abundant reserves, Iran supplies less than one percent of global natural gas exports.