Natural gas production also part of government plans $30 billion of investment seen by Goldman needed for growth
Iran plans to increase crude output by 2 million barrels a day from about 50 energy projects slated for investors at a conference in Tehran next month, National Iranian Oil Co. Managing Director Roknoddin Javadi said.
The package will also aim to boost natural gas production by 7 billion standard cubic feet, Javadi said at a conference in Berlin Thursday. Oil production is now about 2.8 million barrels a day, data compiled by Bloomberg show.
Iran has the world’s largest gas reserves and the fourth largest oil reserves, according to BP Plc figures.
Iran will need $30 billion of investment over five years to boost oil production, starting with about 350,000 barrels of new output next year, Goldman Sachs Group Inc. said in a report Thursday. The supplies could keep pressure on oil prices and delay the market’s return to balance, Henry Tarr, a Goldman analyst, said in the report.
“The global oil market will stay bearish in the short to medium term,” Javadi told the conference.
The July deal agreed by the U.S., France, China, Russia, U.K. and Germany to remove sanctions on Iran in exchange for curbs on its nuclear program point to an early 2016 start if all conditions are met, Goldman’s Tarr said in the report.
Potential investors will be asked to consider contracts over 20 to 25 years, Javadi said. Iran’s council of ministers endorsed a new model contract for the projects in a meeting chaired by President Hassan Rouhani in Tehran, the state-run Mehr news agency reported Wednesday.
The conference is set for Nov. 16 to Nov. 20 in Tehran. Another seminar about the projects is scheduled Oct. 19 to Oct. 21 in Tehran, with Iran’s Oil Minister Bijan Zanganeh set to attend. There is another conference set for London in February.
Iran needs 210 million cubic meters a year of natural gas, with production seen reaching about 300 million cubic meters by the end of next year, Javadi said.
That would leave up to 90 million cubic meters a year available for export. Talks have been renewed with European Union countries to supply them with natural gas via pipeline and liquefied natural gas, with plans to bring its first LNG plant into operation within 2 1/2 years with capacity of 10 million tons a year, he said.