Oman will buy natural gas from Iran for 25 years as part of memoradum of understanding
A key pipeline to be used to transport gas between Iran and Oman under a $60bn deal is set to be ready within 18 months, according to Iranian Ambassador to the Sultanate, Ali Akbar Sibeveih, it was reported.
A Memorandum of Understanding (MoU) signed last month between Iran and Oman means the Sultanate will buy the natural gas from Iran over 25 years.
It will account for approximately 50 percent of its total gas import requirements.
“The agreement on the gas pipeline dates back to 10 years ago when negotiations over the pipeline started, but the two countries could not finalise it,” Sibeveih was quoted as saying in the Times of Oman.
“The main reason was lack of agreement on the price of the gas that was supposed to be exported.”
Sibeveih said Iran had export deals with countries including Iraq, Pakistan, Turkey, Kuwait, and the UAE. Oman was a logical next step.
“The two countries made intensive efforts over the past 10 months in this regard," Sibeveih said.
He noted the pipeline would be launched in the next 18 months if everything went to plan, the Times said.
“The export of gas to Oman will mark a significant economic development in the relations between the two countries," he said.
He said excess gas would be delivered to Japan, South Korea, and India.
In particular the trilateral economic cooperation between Iran, Oman, and India would also be strategic and could play an important role in promoting peace and stability in the Gulf region, he was quoted as saying.
Sibeveih told the Times that Iran and Oman were also working to implement the North-South corridor project, which will become a strategic transit route and facilitate the transportation of goods from Central Asia to the Gulf.
“It is expected that a meeting will be held in Tehran in the near future in which all member states will participate," he said.
Two-way trade between the nation is about $200 million a year, but Sibeveih said he hoped it would reach $1 billion in the near future, with petrochemical, technology and oil refinery sectors among areas for future investment, the Times report said.
The launch of direct flights between Oman and various Iranian provinces would contribute to expanding the relationship between the two friendly countries.