Mumbai: India has raised the offer price of five million tonnes of liquefied natural gas (LNG), to be imported from Iran for 25 years, by a maximum of 50 per cent. Against the earlier quoted price of $3.215 per million British thermal units (MBTU) it will pay $4.775 per MBTU, a top government official said.

"We are willing to pay up to $4.775 per million British thermal unit as against earlier capped price of $3.215 per MBTU," the official said.

India had, in June 2005, quoted a price of $2.90 per MBTU of liquefied natural gas to be imported from Iran through a pipeline passing through Pakistan. The price would remain for the initial two years after which it would be raised to $3.21 dollars per MBTU. Iran rejected the offer and negotiations dragged on without any solution.

GAIL (India), Indian Oil Corp and Bharat Petroleum had jointly signed a deal to import five million tonnes of LNG per annum.

Of the five million tonnes of LNG to be imported from Iran every year, GAIL will be responsible for marketing 40 per cent, IOC 35 per cent and BPCL the remaining 25 per cent, the official said.

As per the formula agreed last year, Iran was to charge India 6.5 per cent of Brent crude oil price at the time of loading of each consignment plus a fixed price of $1.2 per MBTU. The price, according to this formula, was to be capped at $3.215 per MBTU at $31 a barrel Brent price.

"We are willing to raise the $31 cap to $55," the official said adding Tehran had sought a higher ceiling of $65 per barrel.

At $65, the fob price would come to $5.425 per MBTU.

To this $0.30 dollars per MBTU would be added for transporting the gas in its liquefied form in specialised tankers from Phase 12 in gigantic South Pars.