The European Union is said to be working on a political agreement to fast-track plans for future energy deals in Iran.
Financial data and news provider Bloomberg on Thursday cited “two people with direct knowledge of the talks” as saying that the deal could be signed as early as November.
“The deal would cover five areas: oil and natural gas contracts, renewables and energy efficiency, power markets, energy infrastructure and investing directly in Iran’s energy industry,” it said.
“The accord would pave the way for any talks on specific contracts in the future,” Bloomberg added.
Europe is taking great pains to diversify its energy sources and reduce reliance on Russia which accounts for 27% of the gas consumed in the continent.
In its policy paper last year, the European Commission mentioned Iran as a potential source of energy in the face of the West’s rising tensions with Russia. Iran sits on the world's largest proven gas reserves estimated at 34 trillion cubic meters.
On Thursday, the executive arm of the 28-nation EU said it will explore areas of bilateral cooperation with Iran including on energy after the removal of sanctions.
For now, the commission is focusing on preparatory work for launching a dialog on energy with Iran "when the conditions are right", Bloomberg quoted it as saying.
The Europeans joined the US in imposing sanctions on Iran in 2012 which mainly targeted the country’s energy industry.
Last month’s conclusion of nuclear talks has triggered a race among the Europeans for new business opportunities in Iran. Ministers from Germany, France, Italy and UK have traveled to Tehran with executives of major companies while further visits are on the cards.
Iran’s energy officials, however, say Asia is the country’s top priority for exports because gas prices are too low in Europe. Tehran has specifically poured cold water on the idea of piping gas to Europe because of the high costs involved.
Minister of Petroleum Bijan Zangeneh has said Iran would like to transfer its gas to Europe in the LNG form but the option won’t be available for the next three years at minimum.
Nevertheless, EU foreign policy chief Federica Mogherini plans to meet Iranian officials in New York in September to discuss energy cooperation among other things, Bloomberg said.