India may lose a gas project in Iran

New Delhi, Oct 4 (PTI) India's oil diplomacy that
suffered a setback last week when China snatched a deal to
develop one of Iran's biggest oilfields, may again be losing
out, this time on a gas project in that country apparently
over delays on India's part.

After giving the South Azadegan oilfield to China, Iran
has trimmed ONGC-Hinduja Group joint venture's promised 60 per
cent stake in the Phase-12 of the South Pars gas field in the
Persian Gulf, highly placed sources said Sunday.

Iran had last year identified South Azadegan oilfield and
South Pars Phase-12 (SP-12) gas field for the state-owned ONGC
and Hinduja combine, but in the 21 months since virtually no
progress has been made. Iran has put the onus on India's side.

Last week, Iran signed a deal to give the 260,000 barrels
per day South Azadegan oilfield along the Iraqi border to
China's CNPC. And it has now given one-third out of the
promised 60 per cent stake in USD 7.5 billion SP-12 to
Angola's state-owned oil firm Sonangol.

While a firm agreement with Sonangol has not been signed
yet, it has already signed for 10 per cent stake in SP-12 with
Venezuela's PdVSA and was also courting Austria's OMV, the
sources said.

While Tehran believes New Delhi may be dithering on
energy ties under US pressure, Petroleum Minister Murli Deora
said India placed "immense importance to ties with Iran and
(will) continue to pursue energy projects."

"We are very seriously engaged with Iran... be it import
of gas through a pipeline or oil and gas fields for ONGC. We
will continue to pursue projects in Iran and back our PSUs in
their bid to get oil and gas fields," Deora said. "I am very
hopeful that Iran will consider ONGC for grant of at least one
big oil and gas field."

He is also keen on a meeting with the new Iranian Oil
Minister Masoud Mirkazemi.

ONGC Chairman and Managing Director R S Sharma said a few
weeks back he had extended an invitation to National Iranian
Oil Co (NIOC) Managing Director Seifollah Jashnsaz to discuss
SP-12 and other projects but since the suggested dates did not
suit him new dates are under discussion.

ONGC has already committed USD five billion in developing
the Farsi gas field in the same Persian Gulf.

Iran had last year agreed to give the joint venture of
ONGC Videsh - the overseas arm of state-run Oil and Natural
Gas Corp — and Hinduja Group firm Ashok Leyland Project
Services Ltd a 60 per cent stake in SP-12 gas field.

But the Islamic republic has signed heads of agreements
for 20 per cent of the stake meant for ONGC-Hinduja in the USD
7.5 billion gas field with Angola's Sonangol.

Last month, it gave Venezuela's state oil firm Petroleos
de Venezuela SA, or PDVSA, a 10 per cent stake for USD 760
million.


Sharma said irrespective of setbacks ONGC would continue
to pursue opportunities in Iran. "We should look at ways and
means to pursue opportunities in Iran."

Besides South Azadegan, Iran has also awarded the USD 4.7
billion Phase-11 of South Pars field to China National
Petroleum Corp (CNPC).

SP-12 has a production target of 3 billion cubic feet per
day - all or most of which may be used to supply planned
liquefaction facilities for LNG exports. It will also produce
120,000 barrels per day of condensate.

The two trains will produce almost 8.5 million tons per
annum of LNG from gas piped in from SP-12.

Sources said ONGC-Hinduja wanted to export the LNG
produced to India.

State-owned Iranian company Petropars-operated SP-12
project has been modified to take in a fourth production
platform and increase the number of wells being drilled.

The project is planned to produce 3 billion cubic feet of
gas per day for probable liquefaction at the proposed Iran LNG
plant.

The increase in the number of production platforms does
not raise the overall output, but follows shifts in locations.
Two of the four platforms will produce at a rate of one
billion cubic feet per day each, while the remaining two will
have a capacity of 500 million cubic feet per day.

Six new wells are planned, raising the total to 42. PTI
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