Iran gives Total 6 months for making oilfield bid

Deputy Oil Minister says several European and Asian firms have expressed willingness to develop the South Azadegan oilfield, and that the Islamic Republic's MoU with Total is not binding

Total has 6 months for making technical bid for South Azadegan oilfield development.
Total has 6 months for making technical bid for South Azadegan oilfield development.

Iran’s Deputy Oil Minister has stated that the Islamic Republic has set a six-month deadline for France’s Total to offer its technical bid to develop the South Azadegan oilfield.

“So far, a preliminary Memorandum of Understanding (MoU) has been sealed with Total S.A. Company over the expansion of South Azadegan oilfield though it is not equal a final contract and the project has not been assigned to the French company yet,” Roknoddin Javadi has told the Mehr news agency.

The official underlined that Total is required to present its technical bid in six months’ time, asserting ‘however, the pricing issues are not at stake before the envisaged time for making the proposal’.

Javadi maintained that several European and Asian firms have expressed willingness to develop the Iranian oilfield. “The inking of an MoU would not give Total of France a higher priority for carrying out the project,” he asserted.

The official underlined that ‘if only one company is eager to develop an Iranian oil or gas field, negotiation will be conducted with that single agent before reaching a final accord; however, if several firms simultaneously apply to take up the project, development of the field will be awarded through tender.”

Emphasizing that expansion of South Azadegan’s first phase is being implemented by 18 Iranian drilling rigs, Javadi reiterated “all ongoing negotiations with European and Asian companies mainly pertain to the development of the second phase of the joint oilfield.”

Iran’s Oil Minister Bijan Zanganeh had raised the issue with Stephane Michel, President of Middle East, Exploration & Production Division at Total, during the June 2 OPEC meeting in Vienna.

Total marks the first major European oil company which signed a deal to purchase 160,000 barrels per day of Iranian crude.
Zanganeh, while confirming the launch of oil talks between National Iranian Oil Company (NIOC) and France’s Total over the expansion of South Azadegan field, had noted that ‘a confidentiality agreement will soon be signed with Total over the development of the joint field’.

Earlier, the project director of the South Azadegan Seyyed Mahmoud Mar'ashi estimated that the required volume of investment for the project will be less than $5bn.

“Accordingly, certain negotiations have also been held with Hyundai Oilbank of South Korea as well as Japan’s Marubeni Corporation, in addition to Total SA,” Mar’ashi had said.

Presently, the Majnoon oilfield development consortium led by Royal Dutch Shell, in partnership with Malaysia’s Petronas and Iraq’s Missan Oil Company, are extracting a daily average of 210,000 barrels of crude oil from the company.

 

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