Iran hits back at India, inks gas field deal with Russian firm

NEW DELHI: Iran has signed a basic agreement with Russian energy giant Gazprom for development of Farzad B gas field, discovered by a consortium of Indian state-run companies, in an apparent retaliation against India's bid to pressure Tehran for a formal deal by cutting purchase of Iranian oil.

This is likely to strain ties between the two countries as it can potentially hit India's ongoing participation and investment in development of oil and gas sector in Iran.

The agreement with Russia comes on the back of India's failure to finalise a commercial contract for Farzab B with Iran despite the optimism expressed by PM Narendra Modi and President Hassan Rouhani for the same when they met in Tehran last year. Iran's oil minister Bijan Zanganeh recently told Argus, the top global energy market information provider, that Farzad-B field was among three such agreements signed with Gazprom. The other two fields are North Pars and Kish gas fields.


Zanganeh's announcement, made in an interview to Argus publication, follows his threat to replace the Indian consortium led by ONGC Videsh, the overseas acquisition arm of flagship explorer ONGC, in Farzad-B.

TOI had on May 30 reported that Iran was considering the option of inducting companies from other countries to replace the Indian consortium or relegate it to developing a small part of the offshore field.

Government officials here downplayed Iran's preliminary deal with Gazprom and said they were positive about a formal deal.