February 20, 2008 / 2:15 PM / 12 years ago

UAE's Crescent sees progress in Iran gas talks

TEHRAN, Feb 20 (Reuters) - The UAE’s Crescent Petroleum said on Wednesday that it had made progress on talks to resolve a dispute about pricing and volume for gas imports from Iran but had yet to reach a final agreement.

Iran and privately-owned Crescent, based in the UAE emirate of Sharjah, have been locked in tortuous negotiations about the price of gas exports from the Iranian offshore Salman field to the United Arab Emirates since 2006.

The UAE needs the gas to meet rapidly rising domestic demand from industry and power plants.

“We have had some progress and we had a meeting two weeks ago, and we are having another one next week and hopefully we will sum it up,” Hamid Zaheri, Crescent’s general manager in Iran, told Reuters.

“Mainly it is (about) the price and volume of gas to be exported. We are still negotiating. We have not reached a final agreement.”

He declined to give further details.

The deal became controversial in Iran after some politicians said the price should be higher to reflect a rise in international gas prices since it was signed.

As well as the pricing row, the deal has been delayed because Iran has yet to complete facilities to produce the gas.

Iranian Oil Minister Gholamhossein Nozari said in December those facilities were almost finished. Another Iranian official also said in December last year that Iran expected to start supplying gas to Crescent by September although industry sources have said supply could come sooner.

The project involves Iran supplying gas from its offshore Salman field in the Gulf to Crescent. Dana Gas will process and distribute the fuel in the UAE. The initial deal was for supply of 600 million cubic feet per day of gas and first delivery was expected in mid-2006. (Reporting by Edmund Blair; editing by James Jukwey)

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