Page 47 - IRANRptNov21

Iran keen to expand output at shared fields
Iranian oil production up year on year
sectors, adding: "We expect the administration to have many partnerships and agreements between Iran and China."
Despite US sanctions, Sinopec continues to have an operation in Iran; its office is based in the uptown area of Tehran.
An oil industry expert speaking with bne IntelliNews, who didn’t want to give their name, said Sinopec along with other big Chinese oil companies has been exporting roughly 1mn barrels per day (bpd) from Iran in recent months despite a ban by the US.
China is one of eight countries that received a 180-day sanctions waiver from the US in 2018 that shielded continued imports of a specified volume of Iranian oil; it expired, but an unknown, though substantial, amount of grey market exports of Iranian crude have continued to go to China.
Under the waiver, China was allowed to buy 360,000 bpd of oil from the Islamic Republic over the 180 days.
Iranian Oil Minister Javad Owji this week visited the southern province of Khuzestan and reiterated the country’s intent to further develop shared oilfields along the border with Iraq.
Speaking to the state energy sector media outlet Shana, Qassem Saedi, deputy head of the parliament’s Energy Committee, said that the visit “was aimed at reviewing the condition of drilling rigs, the activities of the province’s refining and petrochemical sectors, as well as the quantitative and qualitative assessment of production, development and operation at joint oilfields.” Khuzestan is home to the West Karoun cluster which includes several large oilfields that straddle the Iran-Iraq border, namely Azadegan, Yaran, Yadavaran and Darkhoein, with the first three divided into north and south projects. The block holds an estimated 67bn barrels of oil in place (OIP). Speaking of Owji’s visit to West Karoun for a tour of operations at Yadavaran, Saedi said: “The determination of the Oil Ministry in stepping toward increasing production in joint fields is commendable.” Yadavaran is estimated to hold 30bn barrels of OIP, 35% of which is light oil in the Fahlian layer.
Oil production in West Karoun increased from 70,000 barrels per day in 2013 to the current 420,000 bpd under the previous administration of President Hassan Rouhani.
Despite the massive reserves, the fields have an average recovery rate of just 5-6%, compared with the broader average crude recovery rate across Iranian fields of roughly 24% and the global rate of around 35%.
Tehran believes that by increasing recovery across these fields they can achieve 1.2mn bpd of combined output.
Azadegan, which is home to around 32bn barrels of OIP across the Sarvak, Kazhdomi, Godvan and Fahilan layers, is Iran’s largest oilfield. The giant reservoir is shared with Iraq, where it is known Majnoon (Insane) on account of its size.
Iran’s crude oil production rose 37% during the first five months of the current Iranian calendar year compared to March 21-August 20 of last year.
State-run media quoted secondary OPEC data sources showing that output had risen from 1.9mn barrels per day to 2.5mn bpd.
The figure marks a sizeable rebound following a major fall-off since 2017, when production ran at 3.9mn bpd, dropping to 3.5mn bpd in 2018, 2.4mn bpd in 2019 and 2mn bpd in 2020 in the wake of the US’s withdrawal from the Joint Comprehensive Plan of Action (JCPOA).
The National Iranian Oil Co.’s (NIOC) output increase has been partially facilitated by recent work to raise capacity at the West Karoun oilfield cluster,
47 IRAN Country Report November 2021 www.intellinews.com