In the last round of negotiations on the price of Turkmen gas export to Iran, the two sides have come to a final and specific decision this morning, says managing director of National Iranian Gas Export Company (NIGEC) Reza Kassaie Zadeh.

According to the Fars news agency, Kassaie Zadeh said: “As per the gas contract amendment, signed by Iran and Turkmenistan last year, it was decided that the price of Turkmen gas export to Iran be calculated by a formula (floating price) from the beginning of January 2009. However, in view of the prevailing global economic circumstances and instability in the price of energy, it has now been decided that a provisional ‘6-month gas contract’ on fixed price basis be put into practice”. 

The NIGEC MD said the gas deal allowed for the export of maximum of 30 mcm/d of Turkmen gas to Iran, but the six months period would be used to reach a binding formula for the price of gas in a fresh contract. He said the price of gas in the provisional contract was based on the regional levels and was applicable as of the 1st of January 2009.

Kassaie Zadeh also said Iran would be investing in the development of Turkmen gas reserves near its borders so that Turkmenistan would have access to larger volumes of gas for export to Iran.