NISOC output capacity up

SHANA — Iran’s minister of petroleum, Bijan Zangeneh, recently said that despite the outbreak of the novel coronavirus, oil and gas production in Iran had not faced any disruption. Among Iranian oil production companies, National Iranian South Oil Company (NISOC) enjoys a special status because of its large contribution to Iran’s production.

Ahmad Mohammadi, CEO of NISOC, tells “Iran Petroleum” that production from the oil fields run by this company had seen their output exceed the target by 10,000 b/d despite the impact of sanctions and the current restrictions. He has also said that as soon as sanctions have been lifted, NISOC would be able to bring production back to the pre-sanctions levels quickly.

The following is the full text of the interview Mohammadi gave to “Iran Petroleum”:

How did the Covid-19 outbreak affect NISOC’s development projects?

The Covid-19 outbreak slowed down, to some extent, the development projects as soon as it struck. It is noteworthy that our conditions differed with that ofthe others in dealing with the coronavirus, as we were also under sanctions. Therefore, we had to multiply our efforts in a bid to minimize the impacts of both the coronavirus and the sanctions. We were faced with a tough task in not halting activity in NISOC-run fields. However, we proceeded with our activities through well-thought planning.

Many oil companies in the world have halted their development activities due to the sharp decline in oil prices. Does NISOC plan to follow suit?

The petroleum industry is an international one and we cannot separate ourselves from others. NISOC accounts for supplying more than 80% of Iran’s oil, which is earmarked for domestic consumption and exports. In order to maintain the production capacity and enhance output, development activities within EPC/EPD project should continue. Furthermore, we always think of providing development infrastructure for the day the sanctions have been lifted on Iran’s petroleum industry. In the meantime, NISOC’s production is largely spent on feeding refineries. Therefore, we cannot say that the petroleum industry is experiencing unprecedented conditions because oil prices have plummeted to very low prices and therefore we have to halt our development projects. Despite so many problems we are faced with, we will proceed with these projects to keep the business environment and employment alive and crate development infrastructure. Of course, it has to be noted that the methodology of sanctions has changed this time and has become more complicated. We are in the midst of an economic war. Oil production and export is really complicated and difficult, add to this the Covid-19 outbreak.

Given the reduction in oil production emanated from the Covid-19 outbreak, how long will it take the oil output to rebound to the pre-sanctions levels?

According to arrangements, in case sanctions have been lifted, we will restore about 70% of oil production in less than a month and 100% in three months to the pre-sanctions levels.

Which project has been affected most by the Covid-19 outbreak?

It is really tough, particularly for our colleagues working in operation zones to work with the Covid-19 spread. In all crises and emergency situations, we focus on two points: One is our main and natural task of safe and sustainable production, supporting production and sparing staff any damage and the other one is to help people and communities living around facilities to respect their social responsibility. With the Covid-19 outbreak, we have concentrated on respecting all health protocols and our colleagues, particularly those living far from their families, are trying their best to guarantee safe and sustainable production in oil-rich zones in southern Iran. Furthermore, we have provided help to people living near facilities and installations. The Covid-19 outbreak has sure slowed down EPC/EPD projects as many specialists and service workers who used to come from neighboring cities and provinces were faced with restrictions. Despite all this, NISOC’s oil output was 10,000 ahead of plan because no workover project has been halted over this period of time.

What would happen to NISOC’s 28 packages with the Covid-19 outbreak and petroleum industry sanctions?

In six packages, two wells have so far been completed and five others are to be completed soon. Therefore, a total of seven wells would be completed soon and the rigs installed on these wells will be moved to the location of new wells.

The successful bidders for 9 other packages are known. Preparations are under way for six packages and the fate of remaining packages will be known soon. I hope that construction starts in some of them in the summer.

What stage is the Parsi and Paranj agreement in now?

We are receiving necessary permits for the Parsi and Paranj fields’ development. At the same time, we have held talks with MAPNA so that we would sign an agreement for logistics before the agreement takes effect. Given MAPNA’s potential, I hope that we will soon see production logistics work start in parallel with the required arrangements for the implementation of the agreement.

by Negar Sadeqi

Courtesy of Iran Petroleum