Page 15 - FSUOGM Week 40 2022

FSUOGM POLICY FSUOGM

Iran intends to sign $40bn oil and gas

memorandum with Russia

IRAN IRAN expects to conclude oil and gas contracts in the field but production has yet to commence.
with Russia following a July memorandum with According to NIOC, 46 operating wells are
The two countries are Gazprom, SHANA reported on October 6. required for the field to reach the 3.6bn cubic feet
expanding energy ties. The total amount of contracts under the (102mn cubic metres) per day output that it is
memorandum is estimated at $40bn. This was anticipated to produce for at least 25 years. Some
announced by Deputy Oil Minister of Iran production will continue for 35 years, though,
Ahmad Asadzadeh, a day earlier. based on a recovery rate of 60%.
“In the course of the latest talks between Rus- Meanwhile, Kish was discovered in 2006.
sia and Iran, good progress was achieved on the It lies under Iran’s Kish Island and is estimated
implementation of the memorandum with Gaz- to hold 66 tcf (1.9 tcm) of gas and at least 1bn
prom,” the official stated. barrels of condensate. Of this, around 50 tcf (1.4
He said he hoped that “within the next six tcm) and 331 million barrels, respectively, is
months it will be possible to conclude several deemed recoverable.
agreements.” Development of the field was kick-started
“We hope that the current conditions will in late March 2007 with a $2.2bn allocation of
lead to greater cohesion between Iran and Rus- funds from the NIOC for the first phase, which
sia in the development of bilateral projects in the will be conducted by Iran’s own Petroleum Engi-
oil, gas and petrochemical sectors,” Ahmad Asa- neering and Development Co. (PEDEC).
dzadeh added. Gazprom’s assistance was also said to be
During the summer, Gazprom and the sought to help bring the final development phase
National Iranian Oil Co. (NIOC) signed a of South Pars on-stream during the winter, to
framework agreement covering several of the boost supplies when demand is at its peak.
key areas of focus outlined in a 2018 agreement NIOC CEO Mohsen Khojastehmehr said in
between the same parties. At that time, Moscow July that NIOC had successfully negotiated with
was reported to have signed deals covering 17 Gazprom for the Russian firm to install pressure
fields, while the Russian firms had public deals booster platforms at South Pars phase 11 (SP11).
in place for studies at another 10. Kish and North “Exploration and concept studies on this
Pars are seen as the key fields for supplying the project have ended and foundational studies
incomplete Iran LNG facility at Tombak Port. are underway ... we hope gas production from
North Pars was discovered in 1963 and is Phase 11 will materialise in winter this year,” he
located 120 km south-east of Bushehr Province told the semi-official ILNA news agency. Local
at a water depth of 3,500 metres. It is estimated media outlets said that the deal with Gazprom
to have at least 57 trillion cubic feet (1.6 trillion will see the Russian firm carry out $15bn worth
cubic metres) of gas in place, around 70% of of construction on pressure boosting platforms,
which is located in its upper reservoir. though this figure appears to loosely relate to
At the time of the 2018 deal, 17 wells have high-case scenarios for full-field pressure instal-
been drilled and 26 offshore platforms installed lations. ™

Week 41 15•October•2022 www. NEWSBASE .com P15