India offers higher price for Iran LNG

The possibility of India and Iran reviving an LNG deal struck last year rose with Tehran offering a new price and New Delhi saying it was willing to raise its offer slightly for importing 5 million tonne of natural gas from 2009.

The deal between the two nations became cold after New Delhi rejected Tehran's demand for $5.10 per mBtu as against the agreed price of 2.90 per mBtu.

"They have given us a new offer and now we will start working on that," Petroleum Minister Murli Deora said after a meeting with Iran's Foreign Minister Manouchehr Mottaki.

The Iranian minister had indicated the price offered by India was very low and had to be re-negotiated, Deora said.

"A little higher price is okay but the new price should not be very high from what we had offered...with the new formula I am very hopeful that the deal would fructify," Deora said.

Mottaki said India and Iran complement each other as India wants gas for its developmental plans and Iran wants to earn revenues from gas exports.

"I am optimistic that with further negotiations with a specific formula, you will receive gas very soon," he said.