NEW DELHI, (Reuters) – Iran remains committed to a proposed $7 billion natural gas pipeline running to India via Pakistan despite objections from the United States, its deputy oil minister said on Thursday.
"We will continue to do our best to implement it," Mohammad Hadi Nejad-Hosseinian told a news conference.
The pipeline faces opposition from the United States which accuses Iran of seeking nuclear arms, funding anti-Israeli militias and stirring militant attacks on U.S. forces in Iraq.
But after talks with officials in New Delhi, Nejad-Hosseinian said: "I don”t think Pakistan and India will yield to pressure of the United States. This pipeline will bring peace to the region."
India”s petroleum secretary, S.C. Tripathi, said more negotiations on the project were needed.
"India wants a world-class project and gas availability at steady and stable basis at affordable prices," he said. "We have stated the positions of both sides. The positions are not identical," he added referring to differences in deciding on the pricing of the gas.
Nejad-Hosseinian spoke of different options for the project, including each country building sections in their own territory.
"So if we choose this option, there is no sanction on that because no one will invest in Iranian territory," he said.
Several foreign firms have invested in Iran and U.S. sanctions on the country have not been effective, he added.
India and Iran said in a joint statement they were discussing pricing options for the gas, to be taken forward at a meeting in March between oil ministers of the three countries in Tehran.
"We are going to prepare a draft agreement in March which will include the structure of the project, framework agreement, responsibility of each government and framework of price formula," Nejad-Hosseinian said.
The statement said Iran reiterated a commitment to the agreed scheme of sale and purchase of gas at India”s border and agreed to India”s suggestion to study alternatives India proposed.
Pakistan and India said this month they hoped to start building the pipeline from Iran by 2007 despite U.S. objections. The proposal has been on the drawing board for years but uneasy relations between the nuclear-armed rivals prevented progress.
Nejad-Hosseinian said they hope to deliver gas to customers from the pipeline by 2011 to 2012.
"We do not have estimates for the project. It may cost $6 to $7 billion," he said.
The project is expected to be owned and operated by a consortium of Iran”s National Iranian Gas Export Co. and National Iranian Oil Co., GAIL (India) Ltd. and Pakistani as well as international energy companies.
An Indian official said on Monday the three countries had agreed to set a four-to-six month target to finalise the tripartite agreement.
Iran also signed a deal with India in June to export 5 million tonnes of liquefied natural gas a year for 25 years after 2009. Nejad-Hosseinian said Iran was trying its best to get it ratified by the cabinet”s council of economy as soon as possible.