Malaysia signs $16bn gas deal with Iran

By Najmeh Bozorgmehr in Tehran

Published: December 26 2007 20:50 | Last updated: December 26 2007 20:50

Iran has signed a $16bn gas contract with Malaysia, intensifying its efforts to shift its flow of oil and gas deals towards eastern countries and bypass US-led pressure to thwart investment by western companies.

The contract, signed on Wednesday between Iran’s Pars Oil and Gas Company and Malaysia’s SKS Ventures, owned by Malaysian billionaire Syed Mokhtar Al-Bukary, includes the $6bn development of the Golshan and Ferdows gas fields in the next five-and-a-half years.

The second leg of the contract is worth $10bn and is earmarked for the production of liquefied natural gas from two offshore fields in the southern province of Bushehr. It was not clear what the time frame for the LNG project would be.

The Iranian oil and gas sector is in dire need of foreign investment to help meet mounting domestic consumption and to preserve its production rates.

While the US government has put pressure on its western allies to halt investments in Iran because of suspicions over its nuclear programme, Iran, which has the world’s second largest oil and gas reserves, has openly pushed ahead with deals with Asian companies.

Wednesday’s agreement follows the signing of a $2bn oil contract with China’s Sinopec this month. ...

(http://www.ft.com)