New Delhi, May 2 () India has expressed interest in setting up an LNG terminal at Chahabar port in Iran to ship back home natural gas from Persian Gulf nation, Oil Minister Dharmendra Pradhan said today.

India is keen to set up its engagement with hydrocarbon- rich Iran, which has recently come out of western sanctions, and is lining up USD 20 billion of investment in oil and gas as well as petrochemical and fertiliser projects.

Pradhan said he had during his visit to Tehran on April 9 conveyed interest of Indian companies in setting up fertiliser and petrochemical plants, including in the Chahabar SEZ.

The projects can be "either in joint venture between Indian and Iranian public sector companies or with private sector partners," he said in a written reply to a question in Lok Sabha here.

He said he asked Iran to allocate land in SEZ for the project but no MoU has so far been sized on this.

Also, he expressed India's interest in importing LPG from Iran and proposed to set up an extraction plant in Chahabar.

India is also keen on importing natural gas from Iran either in ships (LNG) or through the proposed Iran-Pakistan-India pipeline, he said.

During his visit, he also "expressed India's interest in setting up an LNG plant and gas cracker in Chahabar port," the reply said.

Pradhan asked Iran for "favourable treatment in the pricing of gas for India and also supply of rich gas at competitive price and on long term basis for the life of the joint venture projects than Indian companies are interested in setting up."

"Competitive gas pricing was crucial in making the projects attractive for the prospective investors," he said.

The Minister also discussed with his Iranian counterpart the repayment of nearly USD 6.5 billion that Indian refiners owe to Iran as also rights to develop Farzad-B gas field in the Persian Gulf discovered by OVL.

"After lifting of sanctions by the international community following the Joint Comprehensive Plan of Action (JCPOA) agreement between P5+1 (China, France, Germany, Russia, UK and the US), the European Union, and Iran, the Central Bank of Iran has requested RBI for bringing the country under ACU mechanism," he said.

After this system is established, all future trade transactions with Iran would be settled through the Asian Clearing Union (ACU), he said.

"RBI in turn has sought concurrence from the Department of Economic Affairs for brining Iran under the ACU mechanism. Actual settlement through ACU mechanism hinges on availability of international euro channels for making the payment," he added.

By Times of India