Page 5 - AsianOil Week 42 2021

AsianOil SOUTH ASIA AsianOil

(ONGC) and Oil India Ltd (OIL) and privately tonnes (612,500 bpd) in 2020-2021, according
owned Sun Petrochemicals submitted bids in the to Petroleum Planning & Analysis Cell (PPAC)
country’s sixth Open Acreage Licensing Policy data. Gas production, meanwhile, has shrunk
(OALP-VI) auction. from 39.75bn cubic metres to 27.78 bcm over
The lack of private and foreign investor the same timeframe.
enthusiasm is a concern for the country, given Government reforms to prices for deepwater
it relies on oil imports to meet more than 80% of gas production, which came into effect in 2016,
its demand, while foreign gas shipments supply have encouraged a flurry of new investment in
more than half of domestic consumption. that space, however. As such, the country’s gas
India’s crude and condensate production production is finally on the rise once more,
slumped from 37.8mn tonnes (759,000 barrels climbing to 2.92 bcm in August compared with
per day) in financial year 2012-2013 to 30.5mn 2.43 bcm in the same month of 2020.™

OVL asks for info on Farzad-B contract

PROJECTS & INDIA’S ONGC Videsh Ltd (OVL) has asked
COMPANIES the Iranian government to clarify the terms of
the contract it awarded to local firm Petropars to
develop the offshore Farzad-B gas field in May.
OVL was part of a consortium that discov-
ered the field in 2008 and says that it retains a
right to a 30% stake in the development pro-
ject. Speaking to India’s Economic Times, OVL
managing director Alok K Gupta said: “We have
sought signed development contract details
from Iran so that we can take an informed deci-
sion on our participation in the gas field devel- sanctions.” In late 2019, then-President Has-
opment project.” san Rouhani said that an investment of $75mn
OVL, Indian Oil Corp. (IOC), and Oil India would be made in Farzad-B by “tapping the
Ltd (OIL) held an exploration service contract domestic resources of [the National Iranian
for Farzad-B that expired in 2009 after the field Oil Co. (NIOC)] in the first phase”, noting that
was declared commercial. the remaining capital for financing the project
Since then, the Indian consortium has been would be procured under buyback or integrated
unable to win the developments rights for the petroleum contract (IPC) terms.
asset. In 2018 OVL made a revised offer to spend NIOC then awarded a $1.78bn deal to subsid-
around $11bn on development of Farzad-B, iary Petropars for Farzad-B’s development.
which included building the infrastructure to Under the deal, Petropars will target sour gas
export the gas. production of 28mn cubic metres per day over
Iran deferred the decision owing to the five years, tapping the field’s in-place resources
required investment, saying that the upstream of 23 trillion cubic feet (651bn cubic metres) of
development part of it should cost no more than gas and around 115mn barrels of condensate.
$5.5bn. OVL insisted that the minimum cost for Previous studies determined that around 16 tcf
the upstream segment alone would be $6.2bn, (453 bcm) of gas and 80mn barrels of conden-
with another $5bn or so required to build a con- sate could be recoverable. The reservoir, which
nected LNG export facility. is located in the 3,500-square km Farsi block at a
The Indian firm also objected to Iran’s water depth of 20-90 metres, is shared with Saudi
demand that India buys all of the natural gas Arabia, where it is known as the Arabiah field.
produced from the Farzad-B block at a price Gas produced from the field will be piped to
equivalent to the rate Qatar charges for LNG to Iran’s Pars 2 refinery in Bushehr Province.
India under a long-term deal – $7 per mmBtu. The buyback deal was signed by Hamid
The Indian consortium was reported to have Reza Masoudi, the CEO of Petropars, and
offered a price of $3-4bn for the entire upstream Pars Oil & Gas Co. (POGC) Mohammad
part of the development. Meshkinfam on behalf of NIOC. POGC is
In May, then-Oil Minister Bijan Zanganeh a fellow subsidiary of NIOC and holds ulti-
said: “The Indians were not willing to take part mate responsibility for the development of
in the project. We negotiated with them twice the South and North Pars projects where Pet-
... but they refused to develop the field due to ropars works on the surface and subsurface.™

Week 42 21•October•2021 www. NEWSBASE .com P5