After losing the Chabahar rail project mentioning delay in funding, India is set to lose another key project in Iran. The gas field project was of due importance as it has been in pipeline for the last 10 years.
It has been announced that India would no longer be involved in developing the Farzad-B gas field in Iran.
Anurag Srivastava, spokesperson, Ministry of External Affairs, India, said that “In January 2020, we were informed that Tehran would develop the Farzad-B gas field on its own and might involve India appropriately at a later stage.
Last week, National Iranian Oil Company (NIOC) Managing Director Masoud Karbasian said that a new operator from Tehran had been roped in to develop the gas field, replacing India’s Oil India Limited and Indian Oil Corporation.
Under the agreement, India was dealt to develop the field but the work on the project was stopped abruptly in 2012, following sanctions against Iran.
A consortium of three Indian companies — ONGC, Oil India Limited and Indian Oil Corporation discovered the gas field in 2008, with an estimation of 21.7 trillion cubic feet of natural gas reserves, 12.8 trillion cubic feet of natural gas and 212 million barrels of gas condensates.
After the sanctions were eased, India became willing again to work on the project in 2015 after the nuclear deal was signed between Iran and Western countries. By May 2018, despite the tremendous progress and ease between the two countries, the US sanctions played the spoilsport.
In May 2019, Iran’s oil minister, Bijan Namdar Zanganeh, said his ministry had devised a plan to finance the development of the Farzad-B gas field.
The National Iranian Oil Company said the Indian side to propose a financial plan for the field’s development. India had reportedly made a $5.5 billion investment plan and Tehran didn’t seem impressed with the plan and asked for a new one.
After slow progress by the Indian side to submit a new plan till August 2019, Karbasian suggested Iran would to give the project to another operator.
India’s External Affairs Ministry gave the reason for disagreement that “follow-up bilateral cooperation” was impacted by “policy changes on the Iranian side”.
India dropped out of Chabahar Rail Project earlier
Earlier Iran and India had signed an agreement to construct a rail line from Chabahar port to Zahedan four years ago which was then dropped out due to delay in funding. India never began the work showing misinterpretations that the project could attract U.S. sanctions.