Iran's long pending plan to supply natural gas to India through Pakistan is expected to reach a concrete stage by Feb 14 when both sides finalise a time schedule for delivery of gas at the Indian border.

In a day that marked India's commitment to buy 7.5 million tonnes of liquefied natural gas (LNG) from Iran, the country with the second largest gas reserves, both nations Friday agreed to move forward on the gas pipeline proposal that has long been held up due to security issues regarding the routing through Pakistan.

"It has been agreed in principle that an Iranian team would arrive here on February 14, the Valentine's Day, on the eve of the Asian gas buyers' summit to negotiate the term sheet for delivery of Iranian natural gas at a designated point at the India-Pakistan border," Petroleum Minister Mani Shankar Aiyar told the media after bilateral talks with Iranian Petroleum Minister Bijan Zangeneh.

The Iranian technical team would specify the quantity, quality and schedule of natural gas delivery through the pipeline. Aiyar is expected to visit Iran in June to finalise the deal.

After the conclusion of LNG deal with Indian Oil Corporation and GAIL (India) Ltd, Zangeneh said he personally favoured having a single pipeline supplying gas to a consumer centre in Pakistan and also bringing it to the Indian border as the economy of scale would reduce the investment requirement.

"Pakistan has conveyed its requirement of 50 million standard cubic metres per day of gas to Iran. India's requirement is expected to be much higher," said Zangeneh.

"The Iranian minister has told us that Pakistan wants a pipeline urgently as its gas requirement is substantial to justify an independent pipeline," a senior petroleum ministry official told.

"We have insisted on the ministry of external affairs brief that the gas has to be delivered only at the India-Pakistan border," the official said.

India agrees that while having two separate pipelines would not be economically viable as it would add to the gas cost at delivery point, India is keen on having security of supply without being a party to the pipeline infrastructure project.

The 2,500 km stretch to Indian border from Iran's South Pars field is estimated to cost around $3.1 billion for a 22 million tonnes gas capacity pipeline. Of this, around 27 million cubic metres of gas would be for Pakistan and the remaining 58 million cubic metres for India.

According to the estimates presented to the petroleum ministry by Iran, the cost of pipeline gas delivered at Indian border even after payment of around $140-180 million transit fee to Pakistan would be four times cheaper than LNG supplies from Iran.

"Finally, something concrete is in the pipeline. It is estimated that the Iranian pipeline gas would be around 60 percent cheaper than LNG even with today's depressed shipping costs," the petroleum ministry official said.

In return for India's agreement to procure large quantities of gas, Iran has not only awarded Indian state-owned gas major service contracts for two oil and gas fields but also participation in refining and other energy related projects.

Among agreements signed Friday was import of 7.5 million tonnes of LNG from Iran for a 25-year period beginning 2009 and Indian state-owned companies getting not for service contract with 20 percent share of Yadavaran field output and full share of Jufeyr field output.