BAKU, June 3 (RIA Novosti) - Iran has proposed buying all of the natural gas produced at an Azerbaijani gas field in the Caspian Sea, the South Caucasus republic's energy and fuel minister said on Wednesday.

"There are a lot of proposals on the purchase of gas from the Shah Deniz deposit. For example, Iran has now proposed purchasing the entire gas amount from this deposit. However, Azerbaijan, being in favor of diversification, will not consider just one option," Natik Aliyev told an international conference on Caspian oil and gas.

Azerbaijan is developing its giant Shah Deniz field, with gas reserves of 1.2 trillion cubic meters, under a production-sharing agreement signed in 1996. Seven companies, including BP, Norway's Statoil, France's Total and the State Oil Company of Azerbaijan are involved in the project.

The gas deposit is located in the south Caspian Sea, off the coast of Azerbaijan.

Azerbaijan first produced gas at the Shah Deniz field in December 2006. Today, the deposit produces 22 million cubic meters of gas and 45,000 barrels of condensate daily.

Russian energy giant Gazprom also earlier announced its interest in purchasing all of the gas produced at the Shah Deniz field.

Aliyev said that the State Oil Company of Azerbaijan was currently holding talks in Baku with representatives from the Russian oil giant on Azerbaijani gas purchases.

"However, this is a lengthy process as it involves long-term rather than short-lived cooperation. That is why, negotiations with Gazprom will continue," Aliyev said, adding that preference would be given to the most advantageous offer for the country.

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