TEHRAN – Iran does not consider India's decision to cut oil imports from Tehran in 2017/18 by a fifth as a threat, ISNA quoted Oil Minister Bijan Namdar Zanganeh as saying on Wednesday.

According to sources close to Reuters, Indian state refiners were going to cut oil imports from Iran, as New Delhi seeks to put pressure on Tehran to award the Farzad B gas field to an Indian consortium.

"India is one of our good costumers, but we cannot sign (a) contract under threat," Zanganeh said.

"India's cut of oil imports from Iran will not cause any trouble to us as we have other buyers," he added.

Zanganeh said despite an extension of deadlines, India has not offered an acceptable proposal for the development of the gas field.

"Their proposal was not profitable to Iran ... We sent (the) Indians a letter and told them we are keen to continue negotiations, but under sensible conditions, not under threats."

India, Iran's biggest oil buyer after China, was among a handful of countries that continued to deal with the Tehran despite Western sanctions over its nuclear program.

A consortium headed by ONGC Videsh Ltd (OVL), the overseas investment arm of Indian explorer Oil and Natural Gas Corp, discovered Farzad B in the Farsi offshore block in 2008.

The consortium, which also includes Oil India and Indian Oil Corp, could not obtain permission to develop the field due to Western sanctions, but those sanctions were removed last year.

India and Iran had both been hopeful of wrapping up the Farzad B deal by March, although Zanganeh said Iran has asked other countries to submit their proposals for its development.

According to a Bloomberg report published on Tuesday, OVL intends to spend more than $3 billion on Iran’s Farzad-B natural gas block.

OVL last month submitted a revised plan to the Iranian government for the block, which the company will be able to develop within five years, Managing Director N.K. Verma told reporters in Mumbai on Tuesday. The Indian oil company is now waiting for feedback from Tehran, Verma said.

EF/MA