Page 10 - AsianOil Week 03 2022

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China reports Iranian oil imports despite

still-applicable US sanctions

POLICY CHINA has reported its first imports of Ira- oil from countries including Oman, the United
nian crude oil in a year despite still applicable Arab Emirates and Malaysia.
US sanctions aimed at parties entering into oil Reuters reported on January 20 that China
transactions with Iran. has offloaded nearly four million barrels of
Data on the imports were included in a Jan- Iranian crude oil into state reserve tanks in the
uary 20 release put out by the General Admin- southern port city of Zhanjiang over the past
istration of Chinese Customs. It stated that few weeks. It attributed the information to a
260,312 tonnes of Iranian crude oil were deliv- trade source and ship tracking specialist Vortexa
ered to China in December. The last Iranian oil Analytics.
inflows recorded by China’s customs authority “There were reports of importing Iranian
were registered in December 2020 at 520,000 crude earlier - but hush hush somewhat. Now
tonnes, Reuters said. I think the Chinese are testing openly to see
Iran’s oil business with China is usually US response,” Tilak Doshi, managing director
conducted on the grey market to avoid sanc- of Doshi Consulting in Singapore, was cited as
tions. Some analysts’ estimates have assessed saying.
China’s imports of Iranian oil at more than Theoretically, by importing Iranian oil despite
500,000 barrels per day (bpd) on average in the threat of US sanctions, China can indicate to
latter months of last year. Buyers are tempted the global market that international oil supplies
by crude offered at a big discount, even if it are moving higher and can thus cool the rising oil
means riding the risk of taking a hit from US price, which some analysts forecast will hit more
sanctions. than $100 per barrel this year.
Various reports have described how Iranian Iran has the world’s fourth-largest oil
crude has been exported to China marked as reserves.™

Iraq on the hunt for new reserves

PERFORMANCE IRAQ is set to kick off a new exploration cam- year to proceed with the campaign. With all the
paign covering offshore and undeveloped required approvals having been provided for the
onshore areas as it seeks to add to its existing offshore survey to proceed, Abdul Jabbar pressed
hydrocarbon reserves. the parties to begin their efforts in earnest.
The country is home to around 144bn bar- OEC director-general Basem Muhammad
rels of recoverable oil reserves based on a con- Khudair said that the onshore-offshore explora-
servative recovery factor of 17-29%, while gas tion effort would comprise 2D seismic surveys
CNOOC agreed to carry resources are more roughly estimated at 130 followed by one exploratory well in each area.
out seismic surveying trillion cubic feet (3.7 trillion cubic metres). CNOOC representative Vincent Xie said
of a 530-square km These figures are currently being reassessed by that a joint working team would be formed by
area offshore the Al-Fao the Ministry of Oil (MoO) and are understood the companies to “achieve the study’s objectives
peninsula, but progress to anticipate significant upside. and reach fruitful results”.
on the project has been Oil Minister Ihsan Abdul Jabbar, speaking in The exploration effort comes as Iraq is
delayed. his capacity as President of the Iraqi National Oil working to expand oil production capacity
Co. (INOC), this week urged the expedition of from the current 5mn bpd to 8mn bpd by 2027
delayed seismic surveys of the country’s offshore and a nationwide push already in motion to
by China’s state-owned China National Offshore develop gas resources, both in terms of har-
Oil Corp. (CNOOC) under a 2019 deal with nessing associated gas that continues to be rou-
INOC subsidiary Oil Exploration Co. (OEC). tinely flared, and exploration and production
This saw CNOOC agree to explore a of free gas for use predominantly in electricity
530-square km area offshore the Al-Fao pen- generation.
insula, with OEC focusing on a connected The MoO is also planning to offer areas in the
120-square km onshore area south-east of the Western Desert for gas E&P and four areas in the
6.4bn barrel Zubair oilfield. area south-east of Nasiriyah, from which it antic-
Work on the project was delayed by the coro- ipates that oil production could reach 600,000-
navirus (COVID-19) pandemic and meetings 850,000 bpd with associated gas in excess of
were held between Chinese and Iraqi parties last 12mn cubic metres per day.™

P10 www. NEWSBASE .com Week 03 21•January•2022