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News number: 8710211079

14:44 | 2009-01-10

Economy

نسخه چاپي ارسال به دوستان

Iran, Russia Agree to Swap Gas

TEHRAN (FNA)- Tehran and Moscow reached an initial agreement to swap gas, Iranian Oil Minister Gholam Hossein Nozari announced here on Friday.



The minister said negotiations are underway to reach a final deal.

"The two sides are continuing their negotiations," Nozari told MNA on Friday.

Based on the agreement Iran will receive gas from Russia in the north and will export the same amount for Russia in the Persian Gulf.

"In case of finalization Iran will receive gas on the northern borders and deliver the same amount to (foreign) customers in the south."

The minister said Iran is also negotiating with Turkey on gas transit.

However, he said, "Iran has not yet reached an agreement with Kazakhstan and Turkmenistan on gas swapping."

Iran plans to increase its share of the global gas markets by swapping 50 million cubic meters of natural gas from the Central Asian countries. The Construction of Sarakhs-Jask gas pipeline is also in line with this plan

Meantime, Iran, which sits on the world's second largest reserves of both oil and gas, is facing US sanctions over its civilian nuclear program.

Iranian officials have dismissed US sanctions as inefficient, saying that they are finding Asian partners instead. Several Chinese and other Asian firms are negotiating or signing up to oil and gas deals.

In a last case, Iran signed gas deals worth $14 billion with Malaysia's SKS Group in early December, including a contract to build an LNG plant.

Following US pressures on companies to stop business with Tehran, many western companies decided to do a balancing act. They tried to maintain their presence in Iran, which is rich in oil and gas, but not getting into big deals that could endanger their interests in the US.

Yet, after oil giants in the West witnessed that their absence in big deals has provided Chinese, Indian and Russian companies with excellent opportunities to sign up to an increasing number of energy projects and earn billions of dollars, many western firms are increasingly showing interest to invest or expand work in Iran.

Some European countries have also recently voiced interest in investment in Iran's energy sector after a gas deal was signed between Iran and Switzerland regardless of US sanctions.

The National Iranian Gas Export Company and Switzerland's Elektrizitaetsgesellschaft Laufenburg signed a 25-year deal in March for the delivery of 5.5 billion cubic meters of gas per year.

The biggest recent deal, worth €100m ($147m, £80m), was signed by Steiner Prematechnik Gastec, the German engineering company, this year to build equipment for three gas conversion plants in Iran.

Washington and its Western allies accuse Iran of trying to develop nuclear weapons under the cover of a civilian nuclear program, while they have never presented any corroborative document to substantiate their allegations. Iran denies the charges and insists that its nuclear program is for peaceful purposes only.

Tehran stresses that the country has always pursued a civilian path to provide power to the growing number of Iranian population, whose fossil fuel would eventually run dry.

Despite the rules enshrined in the Non-Proliferation Treaty (NPT) entitling every member state, including Iran, to the right of uranium enrichment, Tehran is now under three rounds of UN Security Council sanctions for turning down West's illegitimate calls to give up its right of uranium enrichment.

Tehran has dismissed West's demands as politically tainted and illogical, stressing that sanctions and pressures merely consolidate Iranians' national resolve to continue the path.

The UN sanctions address individuals and companies involved in nuclear- and arms-related activities without banning daily trade and non-nuclear investment.

But the US has imposed unilateral restrictions in particular on financial transactions and big investments.

Political observers believe that the United States has remained at loggerheads with Iran over the independent and home-grown nature of Tehran's nuclear technology, which gives the Islamic Republic the potential to turn into a world power and a role model for other third-world countries. Washington has laid much pressure on Iran to make it give up the most sensitive and advanced part of the technology, which is uranium enrichment, a process used for producing nuclear fuel for power plants.

Washington's push for additional UN penalties contradicts the report by 16 US intelligence bodies that endorsed the civilian nature of Iran's programs. Following the US National Intelligence Estimate (NIE) and similar reports by the IAEA head - one in November and the other one in February - which praised Iran's truthfulness about key aspects of its past nuclear activities and announced settlement of outstanding issues with Tehran, any effort to impose further sanctions on Iran seems to be completely irrational.