Page 6 - DMEA Week 06 2021

DMEA COMMENTARY DMEA

Completion nears at remaining

phases of South Pars

Tehran is nearing completion of the 24-phase upstream development of South

Pars, with work on the last of its 14 onshore refineries not far behind

IRAN WORK is nearing completion on the remain- Zanganeh in September to have reached 700
ing development phases of Iran’s South Pars gas mcm per day, up from 280 mcm per day in 2013.
WHAT: field, according to the company responsible for The minister noted that during this period, 26
Iran has completed all the project. offshore platforms, 228 wells, 2,160 km of sea
but one of its 24-phase Last week, Mohammad Meshkinfam, man- pipelines and 30 refining trains had been com-
South Pars development aging director of Pars Oil and Gas Co. (POGC), missioned at the field. Meanwhile, over the
project, with work told local media outlet IRIB that by the end of weekend, the oil minister said that the country’s
ongoing to achieve full the current Iranian calendar year, which ends total daily production had reached a record level
production from the on March 20, “the development … will be nearly of 1.04bn cubic metres per day.
much-discussed phase completed and we will not have any work left Production from South Pars began at phases
11. except for phase 11 in the offshore sector and the 2 and 3 in 2002, with nine phases entering
refinery of phase 14 in the onshore sector, which production during the presidency of Hassan
WHY: will be operational early next year.” Rouhani.
South Pars is the South Pars is split into 24 offshore develop- Future output levels will be dictated by the
country’s most important ment phases and 14 onshore gas refineries which extent to which Iran is able to counter pressure
strategic project and process the gas produced offshore. POGC, a sub- decline, and there are plans to install 20 heavy
President Hassan sidiary of the National Iranian Oil Co. (NIOC), compression platforms to maintain production
Rouhani has overseen holds ultimate responsibility for the projects, levels at a cost of around $1bn each.
nine phases entering with fellow NIOC subsidiary Petropars carrying Work is ongoing at the remaining phase 11,
production. out jobs on the surface and subsurface. which has been perhaps the highest profile of all
The country is home to around 34 trillion Iranian oil and gas projects following the signing
WHAT NEXT: cubic metres of proven natural gas reserves, with of an integrated petroleum contract (IPC) with
Questions over the the supergiant South Pars accounting for around French super-major Total and China National
future of production 14 tcm as well as 18bn barrels of gas condensates. Petroleum Corp. (CNPC) in 2017 targeting pro-
remain, with Iran The Islamic Republic holds a 3,700-square duction to 20.8 bcm per year.
facing a significant bill km portion of the 9,700-square km deposit that The Chinese firm became the lead investor
to implement efforts is shared with Qatar, where it is known as the in SP11 after Total withdrew in August 2018
to maintain reservoir North Dome field. Around 80% of the field’s ini- citing the threat of it incurring US sanctions
pressure to avoid major tial gas reserves are believed to remain in place. should it go ahead with plans. The French firm
decline. A week earlier, Meshkinfam denied reports of had planned to invest an initial $1bn, focusing
a pressure drop across the field, noting that since on a section of the field near the South Pars Oil
March 2020, output had increased by 65mn Layer, adjacent to areas of the field under Qatar’s
cubic metres per day of gas following the com- control.
pletion of the phase 16 gas pipeline. “The drop The company’s 50.1% stake was handed over
in gas pressure in South Pars has not occurred to to CNPC, giving it 80.1%, with Petropars retain-
date and forecasts indicate that in the next three ing the remaining 19.9%.
or four years, the drop in gas pressure will begin Petropars was left as the only remaining part-
gradually,” he said. ner in the $4.879bn project when CNPC pulled
Production from the 23 operational off- out in 2019.
shore phases was reported by Oil Minister Bijan The Iranian firm kicked off drilling work in

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