Reuters: Iran has approved the commercial viability of natural gas production at the Farsi block operated by Indian firms, which will now submit a $3 billion development plan to Tehran, a senior source at a firm holding a stake in the block said.
By Nidhi Verma
NEW DELHI (Reuters) – Iran has approved the commercial viability of natural gas production at the Farsi block operated by Indian firms, which will now submit a $3 billion development plan to Tehran, a senior source at a firm holding a stake in the block said.
Farsi is the first overseas asset for which India firms have obtained exclusive exploration rights.
India's state-run Oil and Natural Gas Corp and Indian Oil Corp each hold a 40 percent interest in the block, while smaller outfit Oil India Ltd has the rest.
It is operated by ONGC's overseas arm ONGC Videsh Ltd.
"In September, they approved the gas commerciality report. Now we will submit the development plan and then they (Iran) will decide on giving the development right," the source said.
"I think the entire process would be completed in three to six months," the top company official added.
Indian firms had submitted a gas commerciality report to Iranian authorities last December, and aim to invest about $3 billion to develop the gas field if Tehran gives the go-ahead.
The block is estimated to hold recoverable gas reserves of 12.8 trillion cubic feet.
Indian firms were awarded a service contract to explore the Persian Gulf block in 2002.
Iran is drawing interest from Indian and Chinese firms that are keen to tap the world's second-largest reserves of oil and gas and are less susceptible than many other companies to Western pressure over Tehran's nuclear programme.
India, which imports nearly 70 percent of its oil requirements and is Asia's third-largest oil consumer, has been intensifying its efforts to boost oil production abroad to make up for stagnating domestic output.
