An Indian delegation will visit Iran this week to scout for investment opportunities ahead of an anticipated nuclear deal between the OPEC-member and world powers that would lift sanctions against the country, sources close to the plan said, Reuters said in a report.
Officials from India's finance and oil ministries and executives from ONGC Videsh and Mangalore Refinery and Petrochemicals Ltd. are part of the delegation that will hold meeting with their Iranian counterparts on Saturday, the sources said.
India is Iran's biggest oil client after China although its imports from Tehran have declined under pressure from western sanctions.
New Delhi's oil imports from Tehran have eased from 370,000 bpd in 2010/11 to about 220,000 bpd in 2014/15 under pressure from international sanctions.
Iran and six world powers reached a framework nuclear agreement on April 2, spurring hopes for a final deal by end-June that would lift economic sanctions imposed by the West against Tehran's nuclear program.
Apart from seeking more oil at better terms and other investment opportunities in the energy sector, India will push for development rights at the Farzad-B gas field in Farsi block, the sources said.
Iran will need significant amount of capital and advance technology for a sharp growth in oil production as many of Tehran's huge and geologically complex fields have not been not maintained "in the best way" due to the sanctions, Fatih Birol, chief economist at International Energy Agency told Reuters in an interview last week.
A consortium headed by ONGC Videsh, the overseas investment arm of the country's top explorer Oil and Natural Gas Corp., signed a deal in December 2002 to explore the Farsi offshore block.
The negotiations are about to take place two years after Iran's oil ministry withdraw its offer to Indian contractors on production sharing contract (PSC) for the development of the Farzad-B field. Tehran had reportedly said that the terms for participation of an Indian consortium were not acceptable.
Iran's oil and gas sector needs $220 billion for new projects and rehabilitation of existing assets, an Iranian diplomat told Reuters, adding Farzad-B development could cost $7 billion.
India did not sign the deal under pressure from the western sanctions, this source said.
Iran holds the world’s second biggest natural gas reserves after Russia, and the fourth-largest proved crude oil reserves. It holds approximately 17 percent of the world's proven natural gas reserves and more than one-third of OPEC's reserves. The country's largest natural gas field, South Pars, is estimated to hold roughly 40 percent of Iran's gas reserves.
