NEW DELHI: Energy sector co-operation with Iran is set to scale new heights after the visit of Prime Minister Narendra Modi to the gulf nation on Sunday.
The Indian delegation accompanying the PM had been told to make the most out of the energy rich country that post lifting of west imposed sanctions has begun dictating terms in the global oil market.
For India, which imports about 80 percent of its oil needs, a stringent relationship with Iran is essential to counter pressure from OPEC, the biggest oil supplier to india. Hence, the Indian side is going with a long list of items for discussion withdrawn.
The prime being liquidation of $6.5 billion of dues that indian oil marketing companies owe to Iranian firms. Post sanctions Iran is talking tough on the dues and wanting India not only give a road map for repayment of the dues but also has asked the country to pay interest on the dues. Iran has also stopped free shipment of oil to India.
Sources in oil ministry said that India will not only seek easier for repayment terms of dues but would negotiate a return to rupee payment for Iranian oil. Also on the agenda would be grant of right to OVL for developing Farzad-B oil and gas block.
On the gas front, India also wants Iran to sign long term LNG supply contract at around $5 per mmbtu.