India, Pak reject Irans suggested gas price

New Delhi, Nov 28 | Updated: Nov 29 2006, 07:03am hrs
India and Pakistan have rejected a consultants suggested price for buying Iranian gas which the energy-hungry Asian neighbours hope to have delivered through a proposed $7-billion pipeline, India said on Tuesday.

UK-based consultant Gaffney Cline and Associates was appointed by the three countries in September, after they failed to agree on a rate acceptable to all.

The price worked out by the consultant, which was based on certain parameters given by Iran, was not acceptable to India and Pakistan, oil minister Murli Deora said. No details were made available, but Deora said Gaffney had been given revised data and asked to work out a new formula.

In August, Iran had offered a price linked to dated Brent crude that equated to about $8 per million British thermal units (mmBtu), while New Delhi wants to pay about $4.25 per mmBtu.

Iran has the second-largest natural gas reserves in the world, behind Russiaabout 940 trillion cubic feetwhile Asian economies, including India and Pakistan, are scrambling for energy sources to feed industrial expansion.

The pipeline has been on the drawing board for years but has been held up by hostility between the countries and US opposition towards Iran.