Iran in talks with UAE to pay fine with gas supply
Senior Iranian Oil Ministry officials want to supply gas from Iran's Salman gas field to Crescent Petroleum instead of paying the fine
Iran is in ‘serious talks’ with the UAE’s Crescent Petroleum to supply gas in order to pay its fine to the company, the Fars news agency reported.
Reportedly, some senior Iranian Oil Ministry officials want to supply gas from Iran's Salman gas field to Crescent Petroleum instead of paying the fine, the source said.
The UAE’s Dana Gas in 2014 said that an international tribunal had issued a favourable ruling in the dispute over a natural gas supply contract between its affiliate Crescent Petroleum and Iran.
The tribunal ruled a 25-year contract for the National Iranian Oil Co (NIOC) to supply gas to Crescent was valid and binding on both parties, and that the NIOC has been obligated to deliver gas since December 2005.
Previously, Iranian media outlets quoted the Industry Minister Mohammad Reza Nematzadeh as saying that Iran has been fined $18bn over the case.
NIOC and Crescent signed the 25-year contract in 2001, with the price linked to oil.
Based on the contract, Iran was supposed to export unrefined natural gas from Salman gas field to the UAE.
However deliveries were delayed as oil prices rose and some officials and politicians in Iran called for a revision to the gas pricing formula.
The Iranian source said that intensive talks are underway between Iran’s Oil Ministry and Crescent, adding it is expected that the contract price will be amended.
The source further said that the two parties seek to finalise the talks and implement the deal during the current Iranian fiscal year (which started on March 20).