State-owned Gas Authority of India (Gail) has started negotiations to renew a $22bn liquefied natural gas (LNG) purchase contract with National Iranian Gas Export (NIGEC).
Originally signed on 13 June 2005, the agreement was intended to purchase five million tons of LNG a year by the Indian state firms, including Gail, Indian Oil (IOC) and Bharat Petroleum (BPCL), at a price of $3.2 per million British thermal unit.
GAIL had agreed to buy two million tons per annum of LNG, while IOC signed to buy 1.75 million tons. BPCL was entailed to take another 1.25 million tons.
However, the deal could not be implemented due to failure of securing National Iranian Oil Company (NIOC) approval by NIGEC within 15 days from the date of signing the deal.
Press Trust of India cited GAIL as saying in a statement: "Dialogue has been initiated with Iranian counterparts to revive the LNG supply long-term sale and purchase agreement.
The talks for revival come following Iran’s nuclear deal with the US and world powers, which is expected to lift-off energy sanctions.
A GAIL official said: "Iran has so far not responded to the offer.
"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."