ONGC inks pact for sourcing LNG from Iran

ONGC and ONGC Videsh (OVL), the overseas investment arm of ONGC, in association with the Hinduja Group and Petronet LNG, have entered into two broad enabling agreements with Iranian authorities for participation in development of gas fields and liquefaction facilities in Iran, in return for assured minimum six million tonnes a year of LNG on long-term basis. ONGC made an announcement on the Bombay Stock Exchange (BSE) today.

The companies have enter into two strategic agreements on Tuesday. An agreement offering OVL and the Hinduja Group company, Ashok Leyland Projects Services (ALPS), 40 per cent participating interest for development of South Pars 12 gas field was inked.

Another agreement offering 20 per cent equity in the liquefaction facilities of Iran LNG, with possible enhancement of equity up to 40 per cent to ONGC, OVL, ALPS and Petronet LNG was signed.

According to a statement issued by ONGC here on Wednesday, the Iranian side has agreed to consider OVL's proposal to develop the Farsi block and bring the gas produced from the block discovered by OVL to India.

The gas can be brought either through pipeline, LNG or swap arrangement. Iran has also agreed to resume detailed discussion on technical, commercial and contractual issues within three weeks in New Delhi, the statement said.