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Oil minister says Iran to launch over 40 new projects worth $30bn by year-end
While the outlook for the Islamic Republic on the world stage remains uncertain as talks with international powers stall, Tehran is focused on increasing oil output for sale on global markets and more gas is required to feed the downstream and satisfy peak demand at home and in neighbouring Iraq.
South oil
A subsidiary of the National Iranian Oil Co. (NIOC) has said that it has ramped up oil production by 600,000 barrels per day (bpd) in the eight months since the administration of Ebrahim Raisi came to power.
Speaking to the official Islamic Republic News Agency (IRNA, Alireza Daneshi, CEO of the National Iranian South Oil Co. (NISOC), said that conditions prior to Raisi entering office were unfavourable, with oil production only sufficient to provide feedstock for domestic refineries.
However, he said that following a request from the Raisi administration, NISOC had modified its oil production plan, the implementation of which has led to the increase.
However, given that the latest data from OPEC, which were released last week, show that Iranian oil production has risen from a 2021 average of 2.4mn bpd to 2.55mn bpd as of March, it appears that Daneshi’s comments were addressing crude production capacity rather than actual output.
This aligns with a statement from the country’s Minister of Petroleum Javad Owji, who said last week: “The current oil production capacity has reached the pre-sanctions era, meaning the daily figure of over 3.8mn barrels.”
A recent report from the Ministry of Petroleum (MoP) said that the country had achieved a capacity of 3.838mn bpd in 2018 before the US withdrew from the Joint Comprehensive Plan of Action (JCPOA).
Iran’s Oil Minister Javad Owji on May 16 announced that his ministry plans to launch more than 40 projects worth $30bn by year-end.
The minister, who spoke on the sidelines of the 26th International Oil, Gas, Refining and Petrochemical Exhibition in Tehran, told reporters: “We will mainly rely on domestic companies for supplying equipment for the projects.”
He described the annual exhibition, aka the Iran Oil Show, as one of the largest and most prestigious oil and gas events in the world, saying more than 1,200 domestic and foreign companies have participated in the occasion this. A great number of contracts and memoranda of understanding (MoUs) have been signed at the exhibition, said Owji.
Also at the exhibition, the managing director of National Oil Company of Iran (NIOC) said his company was set to award the development of the Azadegan oil field to a consortium of domestic companies.
“Following the NIOC’s comprehensive programs for the development of joint fields and the maximum use of the capabilities of Iranian companies, the second phase of North Azadegan field’s development project and the ongoing project of South Azadegan will be awarded to a consortium comprised of exploration and production companies under a $7.5bn contract,” Mohsen Khojasteh-Mehr said.
“So, the final contract is not an exclusive deal and we do not intend to award the field to just one or two companies, but it will be awarded to all of them,” he added.
Meanwhile, the director of the National Iranian South Oil Company (NISOC) said his company was planning on increasing production capacity at oilfields in the south of the country to 3.3mn barrels of day (b/d), oil ministry-owned news agency Shana reported.
Alireza Daneshi put NISOC’s current oil production capacity at 3mn b/d, adding that the 300,000 b/d increase would be realised within five years.
52 IRAN Country Report June 2022 www.intellinews.com