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Iran Sets One-Month Deadline for Indian Oil Companies to Sign Contract

  • In a strategic move to force India's hands, Iran has set a month's deadline for a consortium of Indian state-run oil companies to sign the contract for bringing to production a gas field discovered in the Persian Gulf in 2006.The consortium of ONGC Videsh, the overseas investment arm of ONGC, northeast explorer Oil India Ltd and refiner-marketer IndianOil Corporation had in 2010 told Teheran it planned to develop the Farsi offshore block by pumping $5 billion over seven-eight years.
  • But it did not sign a contract for fear of being blacklisted by the US under the 1996 Iran-Libya Sanctions Act of the US that barred any entity to pump more than 20 million in any 12-month period. US blacklisting would have made difficult for the Indian oil companies in the consortium to source funds, technology and other oilfield services.

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