Zanganeh: No Doubt in Investment

Zanganeh made the remarks in a ceremony, held in Tehran on Tuesday for conclusion of a HOA agreement for gas field development by the National Iranian Oil Company (NIOC) and a consortium, led by French Total, also consisting Iranian Petropars and Chinese CNPC. 

Under the deal, phase 11 of South Pars gas field that is shared with Qatar will be developed by the consortium.

The minister said Total has been vanguard in Iranian oil industry with a working background under harsh conditions in Iran.

He expressed pleasure with cooperation with Chinese CNPC in development of phase 11 of South Pars and said, “We will never forget the Chinese companies, that are the strategic partners, and our cooperation will continue in the long-run.”

Zanganeh expressed hope that following conclusion of the deal for development of the South Pars gas field’s phase 11, international companies should set aside doubt for investment in the Iranian oil industry.

The minister said about 70 percent of the value of development activities in phase 11, which is expected to be about 3.5 billion dollars in value, will be in Iranian companies’ control.

He noted that Iranian companies should work in an atmosphere of competition.

He said one of the goals behind enforcement of the new model of oil contracts is establishment and promotion of the Iranian E&P companies. “If two out of 11 Iranian companies, identified to be qualified for activity as E&P companies, turn into E&P companies, it will be a great job.”

He also referred to abut 20 percent share of Petropars company in the Tuesday gas deal and said signing the deal, the Iranian company will reserve an important status. 

He advised the Iranian company to benefit from the capacity of such a standing for transfer of technology in different fields, including management of project and of reserves.

He said development activities on the former 27 phases are now over and will in the coming years suffer falling pressure, so mechanisms should be find to check it.

Noting that South Pars gas extraction will rise up to more than 300 million cubic meters a day, Zanganeh said South Pars oil layer will reach production state for the first ever this year.

Elsewhere in his remarks, Zanganeh said Iran’s daily oil production should reach 4.8 million barrels in the Sixth Five-Year Plan (2016-21) and part of the increase in the production will depend on using the enhanced recovery methods.

He noted that about 130 billion dollars are needed as investment in Iranian upstream oil industry in the Sixth Plan.

“Iranian oil industry needs technology and capital in order for investment. The technology should not be restricted to technology of reserves; rather, even if a company manages to complete a project in four  years than 12 years, this can be a token of technology.”

To the end of his remarks, Zanganeh said, “We should preserve our share in the world markets and maintenance of production will be a main precondition for success in the way. Preserving the share in the world markets will not just depend on political activities because country’s power does not depend on reasoning and speaking; production capacity will play a decisive role in this connection.”