Iran hopes to sign $15bn worth key upstream deals by March 2018
Negotiations for the development of Phase 11 of South Pars, Azadegan oilfield and South Pars oil layer are in an advanced stage, with major IOCs bidding for the deals, state-owned NIOC's MD says
The National Iranian Oil Company (NIOC) expects to conclude new contracts worth $15bn with international majors to develop some of the country's key oil and gas fields, the state-owned company's managing director has been quoted as saying in a media report.
“It is estimated that new oil contracts worth over $15 billion will be signed with international companies by the end of this Iranian year (March 20, 2018),” Ali Kardar, who is also the Islamic Republic’s deputy oil minister, told the official Islamic Republic News Agency (IRNA).
Negotiations for the development of Phase 11 of South Pars, Azadegan oilfield and South Pars oil layer are in an advanced stage, Ali Kardor, was quoted by IRNA as saying.
“The fields are on priority list and the Ministry of Petroleum emphasises their development, as they are shared fields,” Kardor added.
The official also noted that the tender for Azadegan was going to be held soon with international firms competing for it. IOCs including France's Total, Malaysia's Petronas and Japan’s Inpex, have presented technical surveys for the development of the Azadegan oilfield, Kardor revealed.
He went on to say that Royal Dutch Shell, Italian major Eni and CNPC, China’s largest integrated energy company, are the other contenders for the oilfield.
A total of 75 oil and gas field development proposals are expected to be presented to the state-owned NIOC, almost two dozen of which have been submitted so far.
Through the use of a floating production platform, the government said peak capacity would be in the range of 35,000 barrels of oil per day (bpd). “It (Azadegan) is located in southern Iran, 80km west of the Khuzestan provincial city of Ahvaz,” Kardor said.
Production is now about 80,000 bpd from South Azadegan. The government estimates the field holds around 6bn barrels of recoverable oil reserves.
Iran’s neighboring countries have extracted oil and gas in shared fields using multi-national companies’ funds, and gained huge revenues as Iran were struggling with international sanctions, Kardor commented.
Shortage of financial resources in the past years also added to Iran’s inability to develop the fields, he added.
Now, focussing on the shared fields to develop them and offering new oil contracts, Iran is trying to fill the gap, Kardor said.
Iran pulled oil from the South Pars field, which Qatar dubbed North Dome, for the first time in March.
Iran has signed a range of deals with international firms over the past year since the easing of international sanctions on Tehran, the report said.
In November 2016, Total became the first oil major to sign a big deal with Tehran since the lifting of sanctions and agreed to help it develop the world's largest gas field, South Pars.
Royal Dutch Shell signed a provisional deal last December to develop Iranian oil and gas fields South Azadegan, Yadavaran and Kish in December 2016.
Iran has named 29 companies from more than a dozen countries as being eligible to bid for 50 oil and gas development projects using the new, less restrictive contract model, known as the Iran Petroleum Contract (IPC) launched in late 2015.
The firms include Shell, Total, Eni, Petronas and Russia's Gazprom and Lukoil, as well as companies from China, Austria, Japan among other countries.
Last month, Iran’s Oil Minister Bijan Zangeneh told IRNA that the Islamic Republic had already invited worldwide oil companies to participate in the tender for the development of the Azadegan oilfield.