Indian media have reported that the countrys state-run gas utility GAIL has begun talks with Iran to revive a decade-old LNG supply contract with the country.
The Business Standard has reported that GAIL has opened talks with Iran over the LNG contract whose value is estimated to be $22 billion in light of the prospects for the removal of sanctions against Iran.
"Dialogue has been initiated with Iranian counterparts to revive the LNG supply long-term SPA," the Business Standard has quoted GAIL as announcing in its latest annual report.
In 2005, three Indian firms namely GAIL, Indian Oil Corp (IOC) and Bharat Petroleum Corp Ltd (BPCL) signed deals with the National Iranian Gas Export Company (NIGEC) for buying a total of 5 million tons a year of LNG from Iran.
The related price of the LNG $3.215 per million British thermal unit (mbtu) has been described by the Business Standard as extremely attractive.
"Iran has so far not responded to the offer," a GAIL official said. "There is a half-finished LNG export terminal in Iran which will have to be completed before any export of LNG can begin from Iran."
GAIL under its deal with NIGEC will buy 2 million tons per year of LNG while IOC and BPCL will each purchase 1.75 million tons and 1.25 million tons from Iran.