India willing to pay 50 % more for Iran LNG

India is willing to pay 50 per cent more than the price agreed in June last year, to buy 5 million tonnes of liquefied natural gas (LNG) from Iran.  
GAIL (India), Indian Oil Corporation and Bharat Petroleum, which had in June 2005 signed a deal with National Iranian Gas Export Company to buy 5 million tonnes of LNG at $3.125 per million British thermal unit (mBtu) cap price, are now willing to pay $4.775 .  
?Iran has have been insisting that the June deal is off unless the price is revised. Though we have a water-tight legal case against them for not honouring a signed deal, we do not want to rock the boat now,? an official said. According to the formula agreed last year, Iran was to charge India 6.5 per cent of the Brent crude oil price at the time of loading of each consignment plus a fixed price of $1.2 per mBtu.  
The price, according to this formula, was to be capped at $3.215 per mBtu at $31 a barrel Brent price. For the initial two years, a 10 per cent discount was allowed leading to a price of $2.9 per mBtu from 2009 to 2011. ?We are willing to raise the $31 cap to 55 ,? the official said adding that Tehran had sought a higher ceiling of $65 per barrel.  

Source: Business Standard, New Delhi
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