India, Iran to discuss gas pipeline on Dec 28-29

MUMBAI (Reuters) – India and Iran will hold bilateral talks
this week in New Delhi to discuss the progress of a proposed $7
billion Iran-Pakistan-India pipeline and a separate liquefied
natural gas deal between the two nations.

Iran’s deputy oil minister, Mohammad Hadi Nejad-Hosseinian,
is scheduled to participate in these discussions on December 28
and 29, after arriving in India on Tuesday evening.

“The biggest challenge before us today is to find a way as
to how do we structure the project in a consensual way,” an
official from the Indian oil ministry, who did not wish to be
identified, told Reuters on Monday.

The official said the three countries had mutually agreed
to set a four- to six-month target to finalize the tripartite
agreement on the natural gas pipeline project.

“I can assure you that there is no change or delay in the
schedule of finalizing the project,” he said, responding to a
newspaper report at the weekend saying the pipeline project was
likely to be delayed by six months.

“We have always maintained that given the complexity and
technical nitty-gritties involved in the project we will
finalize the details only by April or June 2006,” the official
said.

Pakistan and India said this month they hoped to start
building the pipeline from Iran to South Asia by 2007 despite
U.S. objections.

The proposal to build the pipeline has been on the drawing
board for years but uneasy relations between nuclear-armed
rivals Pakistan and India prevented any progress.

The official said discussions would revolve around four
core issues, including technical specifications, financial
structure, measures to boost investor confidence and the price
of the gas sold by Iran to India and Pakistan.

“International support for the pipeline is least of our
concerns as we have many multinational companies including
Russia’s Gazprom interested in our project,” he said.

The pipeline faces opposition from the United States, which
accuses Iran of seeking nuclear arms, funding anti-Israeli
militias and stirring militant attacks against U.S. forces in
Iraq.

Nicholas Burns, a top U.S. State Department official, said
last month India had assured the United States that any plans
to sign energy deals with Iran were “years away” and existed
only in the hypothetical realm.

The official said representatives from all three countries
would meet in Tehran in March to review progress in the
project.

India, which imports 70 percent of the oil it consumes, is
in talks to build gas pipelines from Myanmar, Iran and
Turkmenistan to meet the growing energy needs of its expanding
economy.