Page 6 - DMEA Week 04 2021

DMEA COMMENTARY DMEA

As pressure eases, Iranian oil

exports edge upwards

Iran has maintained a base level of exports through various covert means

IRAN IRANIAN Minister of Petroleum Bijan Zan- international observers and reports suggest that
ganeh said last week that a sharp increase has volumes have been and continue to be blended
been experienced in the country’s oil exports and sold as ‘Iraqi crude’.
following the end of the Presidency of Donald
Trump in the US. Goreh-Jask update
While the increases have been modest, with In related news, local firm Petroleum Engineer-
Bloomberg quoting various industry sources as ing and Development Co. (PEDEC) has said that
saying that the gains are around 30,000-50,000 work on the first phase of Iran’s strategic Goreh-
barrels per day (bpd), they represent increased Jask oil pipeline project is now more than 70%
confidence on behalf of buyers though covert complete.
practices continue to be employed to maintain The company’s deputy director of the project,
a lack of clarity about sales. Ali Jafarzadeh reiterated that the phase will be
Given China’s history of working around completed by the end of the current Iranian cal-
the sanctions to continue buying Iranian oil, it endar year, which ends on March 20.
would be unsurprising if sales had increased, In December, PEDEC’s managing director
while Bloomberg quoted a trader as saying that Touraj Dehghani said that the first phase would
Iranian flows had ticked upwards. have a capacity of more than 300,000 bpd with
Throughout the ongoing period of sanctions, more than 400km of pipe having now been laid.
Iran has maintained a base level of export through Meanwhile, the full 1,000km project will have a
various covert means, including turning off ship- total capacity of 1mn bpd when complete by the
ping transponders to make vessels ‘go dark’. end of 2021.
Meanwhile, Zanganeh admitted that it had Work began on the line last April, with Pres-
sought to obfuscate the origin of cargoes, saying ident Hassan Rouhani saying at the time that
“whatever [Iran] export[s] is not under Iran’s “Jask will turn into Iran’s key hub of oil exports.”
name” and supporting “any proposal for selling The pipeline will link the Gulf port city of
Iranian crude”. Goreh in Bushehr province to Jask on the Sea
He had previously been asked if Iran was still of Oman. At present the Kharg Island terminal
selling oil on international markets and replied: in the Gulf accounts for 90% of the country’s oil
“officially nothing”, with covert sales understood exports.
to be continuing to Chinese clients as well as Of the $1.8bn total project cost, the Goreh-
quantities piped and trucked into neighbouring Jask pipeline is anticipated to come in at around
countries, particularly Iraq. $1.1bn, with the remainder being spent on the
Various investigations by Middle East Oil development of the port. The Jask port will
& Gas (MEOG) learnt that political alliances feature 20 tanks with a total storage capacity of
between Iran and Iraq had allowed the former to 10mn barrels of crude, with plans in plans to
act as a conduit for Iranian oil into the interna- expand export infrastructure.
tional markets in order to help it circumvent the Meanwhile, Jafarzadeh noted that more
US’s re-imposed sanctions, just as it did under than 96% of the equipment and parts used were
the previous longstanding sanctions regime. sourced domestically, adding that by using
Trucks moved oil between the two countries, domestic contractors, the developers had saved
beginning at around 15,000 bpd, and ramping more than $606mn.
up to at least 60,000 bpd. Progress is also being made at associated
In theory, these trucks move from the Kirkuk export facilities, with head of the Jask Oil Termi-
region across the border into Iran’s Ilam prov- nal Project Vahid Maleki saying that work had
ince for use in its Kermanshah, Shazand, Tehran begun to install a 2.5km pipeline pipe that will
and Tabriz refineries, whilst Iran in turn deliv- feed the first single-point mooring (SPM), an
ers an identical amount of the same quality to integral element in phase one.
Basra, whereupon it is moved to Al Basrah Oil When complete, the offshore facilities will
Terminal (ABOT) and/or Khor Al Amaya Oil comprise two 6-km pipelines each with a diame-
Terminal (KAAOT), depending on availability ter of 36-inches (914mm) in addition to the SPM.
at the time. The terminal which is being developed by
However, in reality once delivered to Iraq, Pars Oil and Gas Co. (POGC) at a cost of around
it is impossible for the crude to be traced by $315mn. ™

P6 www. NEWSBASE .com Week 04 28•January•2021