Iran: Crescent should Pay more for Gas

Other News Materials 18 September 2007 02:58 (UTC +04:00)

( Fars News Agency)- Iran will find other customers for gas assigned to a deal being negotiated with Crescent Petroleum or use the fuel itself if the UAE firm does not agree to pay a higher price, Iran's caretaker oil minister said on Sunday.

Iran and Crescent, a shareholder in the United Arab Emirates energy firm Dana Gas, have been locked in tortuous negotiations over pricing the gas for export, since it was signed in 2001.

The deal has become politically contentious in Iran, with many prominent politicians saying Iran will lose out because gas prices have risen sharply since the contract was agreed.

"Until the price is corrected, we are not going to sell them (Crescent) natural gas," Gholamhossein Nozari told a news conference.

The project involves supplying gas from Iran's Salman field in the Persian Gulf to Crescent, which owns a separate company along with Dana Gas for the purpose of importing the fuel from Iran.

"If we do not succeed in correcting the price, we have other customers from Emirates and also Oman for the gas," Nozari said.

"Also using the gas inside Iran is an option," he added.

Oman and Kuwait are among the Persian Gulf Arab states seeking natural gas supplies from Iran, which holds the second-biggest natural gas reserves in the world after Russia.

Dana Gas was set up to deliver gas to utilities and industrial users in the UAE. With the Iran gas deal delayed, the company has virtually no operating income.