TEHRAN, June 19 (UPI) -- Turkmenistan, which provides Iran with 8.4 billion cubic meters of gas annually, will negotiate a new contract with Tehran.
The current bilateral contract, signed for six months, expires June 30.
Russian information agency Iran News reported June 19 that the current contract contains fixed prices for deliveries through the $195 million, 124-mile, 8.4 bcm Korpezhe-Kurt Kui pipeline. Opened in 1997, Korpezhe-Kurt Kui was Central Asia's first natural gas export pipeline to bypass Russia's pipeline monopoly.
Current daily deliveries of Turkmen gas to Iran's northern provinces now run at about 23 million cubic meters. According to National Iranian Gas Export Co. Managing Director Reza Kasaei Zadeh, Iran will be seeking price reductions, as the price of hydrocarbons has declined since the global recession began late last year. Should agreement be reached on price, the Iranian negotiators can extend the supply contract to three years.
Kasaei Zadeh noted that the Iranian team will work with its Turkmen counterparts to develop a new pricing formula, which will allow for the price to be reviewed every three years as the market shifts.
