New Delhi, 28 Aug The Indian Oil Corp’s (IOC) proposed $5.7 billion (Rs2, 33, 130 crore) investment for setting up an integrated LNG project in Iran is slated to be shelved with the validity of the 2004 agreement ending in October.
IOC had signed an MoU with Petropars of Iran in 2004 for developing a gas field, setting up a facility to liquefy the gas and building a terminal for exporting liquefied natural gas (LNG). The agreement expires on 31 October with Tehran choosing not to respond to the Indian firm’s proposal, company sources said.
IOC-Petropars had made a pre-proposal to obtain in-principle approval from National Iranian Oil Company (NIOC) for allocating blocks in one of the phases in the gigantic South Pars field on nomination basis and for setting up liquefaction facilities. NIOC, however, said that since South Pars field had already been allocated, it would examine the possibility of allocating block to IOC-Petropars from the North Pars field.
For conducting due diligence of North pars field, IOC-Petropars was required to enter into a confidentiality agreement with Pars Oil and Gas Company (POGC). A draft confidentiality agreement was jointly prepared by IOC and Petropars and forwarded to POGC in July 2006. POGC, however, did not respond, the sources said.
IOC sent reminders and in June sought a meeting of the chief executives of NIOC and IOC, but Iran did not respond to any of the requests.