SHANA - Iranian Minister of Petroleum Bijan Zangeneh says Iran expects to generate a total of 4 billion dollars by developing Aban and West-Paydar oilfields that it shares with neighboring Iraq.

Addressing a ceremony to sign a contract to develop the two fields here in Tehran on Wednesday, the official said oil recovery from the two fields is pretty difficult but once the envisaged 67 million barrels of crude is produced from the fields, the country will have generated 4 billion dollars given the current oil prices.

Aban oil field is located 38 kilometers southwest of the city of Dehloran, and Paydar-e Gharb field is situated 150 kilometers northwest of the oil-rich city of Ahvaz and 35 kilometers from Cheshmeh-Khosh processing facility in Ilam Province. Both fields are jointly owned by Iran and Iraq. Their current production together stands at 36,000 b/d.

A memorandum of understanding (MOU) was signed with Zarubezhneft on July 12, 2016 for the Russian company to study the Aban and Paydar-e Gharb fields under the newly developed model of contracts (IPC) with a view to accelerating oil and gas fields Iran shares with neighboring countries.

For the purpose of improving recovery and increased production from these two fields, the current agreement is signed between the National Iranian Oil Company (NIOC) on one side and Zarubezhneft and its Iranian partner Dana Energy on the other for a period of ten years.

�By implementing this contract, crude oil production of Aban and West-Paydar fields will increase 67 million barrels from currently 38 million barrels to 105 million barrels,� Mr. Zangeneh said.

He stated that the plan for the development of Aban and West-Paydar fields is being conducted in a relatively deprived area, saying that for the first time, a prestigious Russian company has joined the project to develop Iran's oil fields.

The official noted, however, that Iran has had deals with Russians for buying technical oil services previously but this is the first such deal for crude oil production on EPC terms and �we hope it would not be the last one.�

He also added that NIOC talks is on the go with such Russian companies at Tatneft, Gazprom, Lukoil, Gazprom Neft, etc.

He also predicted that the coming calendar year that begins on March 21 will be a very busy year for Iran�s oil industry as many of the ongoing talks with developers are reaching fruitions and will bear results in the coming year.

The CAPEX calculated for the development of Aban and Paydar-e Gharb fields is estimated at $674 million (including direct capital, and downhole pumps repair and replacement costs). Indirect costs are estimated at $68 million.