No special concessions to Total in SP. 11 deal: Official

SHANA – Gholamreza Manouchehri, deputy for development and engineering at the National Iranian Oil Company, says so special concessions have been offered to developers in the deal National Iranian Oil Company (NIOC) has signed with a consortium comprising Total, CNPCI and Petropars.

Addressing a press conference on Saturday, the official said the talks for concluding a landmark deal for developing the offshore project in Persian Gulf waters were pretty arduous and intense but no special concessions were made to developers of the project.

NIOC on July 3 signed a contract with a consortium comprising Total, China’s CNPC International and Petropars Company for developing the project in Persian Gulf waters.

Manouchehri said enhancing production of oil and gas is among petroleum industry’s top priorities in upstream sector under the 6th five-year development plan.

He said studies by international companies indicate that Iran’s oilfields have the potential to produce 3 million barrels per day to the country’s current production capacity in a matter of 10 years.

The NIOC deputy CEO said developing upstream projects in oil industry by adopting state-of-the-art technologies will create opportunities for the return of top Iranian industry elites who left the country years ago.

“Implementation of upstream oil industry projects will accelerate generation of jobs and production in the country while offering domestic manufacturers unparalleled opportunities,” he added.

Elsewhere in his remarks, Manouchehri said under the 6th development plant of the country, Iran needs over 200 billion dollars in fresh investments in its oil industry of which nearly 150 billion dollars must be procured by foreign resources.

He said updating oil industry standards has been included in the newly-devised model of oil contracts, adding the deal require developers to promote the level and pattern of production from reserves.

The official said the country undergoes billions of dollars of losses for delaying production from South Pars gas field that is shared with Qatar in Persian Gulf.

South Pars Phase 11 is being developed for production of 2 million cubic meters of natural gas.

Total will operate the project with a 50.1% interest alongside Petropars (19.9%) and the CNPC (30%). The consortium is expected to produce around 50 million cubic meters of gas per day from the offshore reserves of SP. 11 project.

During 20 years of gas extraction under the contract, an estimated volume of 335 billion cubic meters of rich, sour natural gas will be produced from the phase with 290 million barrels of gas condensate, 14 million tons of liquefied petroleum gas (LPG), 12 million tons of ethane and 2 million tons of sulfur as well as 315 billion cubic meters of light sweet gas.

The energy carriers to be produced by the project are estimated to be valued at more than $54b considering the current prices.

Preliminary production from the project will begin from the project 40 months after signature of the contract. Considering the intricacy of construction of pressure boosting facilities, 36 months has been allocated to studies and 60 months for platform construction under the contract.