Business & Economy

Breakthrough: India signs mega LNG deal with Iran 

What is India News Service, Saturday, 8 January 2005, 2100 hrs IST

India today entered into an agreement with Iran to import 7.5 million tonnes per annum of liquefied natural gas (LNG), starting 2009, over a period of 25 years.

In turn, Iran will give Indian firms developmental rights in two producing oil fields\97Yadavaran and Jufeyr.

The two countries broke the year-long deadlock on the issue of LNG pricing a day after the roundtable talks of principle Asian buyers and sellers, termed as \91mini-OPEC\92. 

Iran had wanted to peg the LNG price to the Brent crude price, while India sought a fixed price contract. Finally, it was agreed that while Iran will sell the LNG to India at a price linked to Brent crude, there will be a ceiling.

So, for a unit of LNG, India will pay $1.2 plus 0.065 into the Brent crude price average. However, Brent price will have an upper ceiling of $31 a barrel. This implies that even if Brent crude price crosses $31 a barrel, 0.065 of $31 a barrel will be taken for calculating the price, translating into $3.21 dollars per million British thermal unit. 

The total LNG deal between the two countries works out to around $35-$40 billion. 

The LNG price for the first three years of supplies will be fixed at $2.97 per unit to try and make imports competitive with the Qatar price. Qatar is currently selling LNG to India at $2.53 per unit fixed price for 5 years up to 2008, after which its price will be linked to $16-$24 a barrel price band.


U.S. upholds tariffs on shrimp: The U.S. International Trade Commission on Thursday cleared the way for tariffs to be imposed on shrimp imports from six Asian and South American countries.

Regional stock exchanges get new lease of life: The fall in the Sensitive Index in the last few days is just a market correction and the movement in the capital market was quite orderly after the giddy rise in the last few days, according to the Finance Minister, P. Chidambaram.

Jet Airways files papers for IPO: Naresh Goyal promoted Jet Airways on Friday filed papers for an initial public offer (IPO) with the Securities and Exchange Board of India (SEBI). This largest private airline will raise the funds from the domestic market for 1.72 crore equity shares which will be on offer.

Tata, Reliance Info asked to withdraw fixed wireless ads: The Telecom Regulatory Authority of India has directed Tata Teleservices and Reliance Infocomm to withdraw the misleading advertisements for fixed wireless services as `Walky' and `Unlimited cordless' and stop making such claims.


GAIL plans IGP meet: GAIL (India) ltd has drawn out Industry Gas Plan meet (IGP) in order to ensure uninteruptted supply of gas to its buyers and consumers. This meet which is going to be held every month will for the first time bringing together gas suppliers and marketers of natural gas in the country. This will result in better coordination and effective management of gas receipt and supply business to the advantage of the customers of gas.

Ittiam\92s heart beat in digital goodies: Bangalore-based Ittiam Systems has ventured into the sphere of IT product development, shunned by most Indian companies. In a short span of time, it has successfully developed products, which are being used by global brands like Sony, Premier Image and so on.