Int’l Consortium to Develop Azadegan Oilfield Project

EghtesadOnline: The National Iranian Oil Company has decided to award the development rights for the giant Azadegan Oilfield in Khuzestan Province to an international consortium, the NIOC deputy director said, indicating Tehran's willingness to bring together some of the world's top oil companies to develop one of its most prized deposits.

News ID: ۷۷۹۱۷۸

16 September 2017

Gholamreza Manouchehri did not name the companies, but big names, such as Italian oil and gas firm Eni, China's CNPC, Royal Dutch Shell, France's Total, Japan's Inpex and Malaysia's Petronas have submitted their master development plans for the Azadegan field, IRNA reported on Tuesday.

Oil Minister Bijan Namdar Zanganeh and other top officials have underlined Azadegan as the first major oil project to be tendered within the framework of Iran Petroleum Contract, the country's new contractual model in oil and gas projects.

But on Tuesday, Manouchehri suggested the oil layer of South Pars Gas Field in the Persian Gulf could become the first IPC-based oil tender after last year's lifting of sanctions, Financial Tribune reported.

“Finalizing a deal [for Azadegan Oilfield], the NIOC has a 12-month schedule,” Manouchehri was quoted as saying by IRNA.

Azadegan, which is divided into northern and southern sections, has about 33 billion barrels of oil in place, some 6 billion barrels of which are deemed recoverable. It is the biggest oilfield discovered in Iran over three decades.

Noureddin Shahnazizadeh, the managing director of Petroleum Engineering and Development Company that is the operator of the field, had said Iran would welcome the formation of an international consortium of British, Japanese and French firms to develop Azadegan.

In a letter published in June outlining Iran's oil and gas production plans, Zanganeh expected 10 oil and gas deals to be signed based on the IPC framework by March 2018, the end of the current fiscal year.

Iran has so far developed Azadegan in the northern and southern sections, but plans are made to develop both sections under a single development plan.

Shahnazizadeh noted that $2.2 billion have been spent on the northern part. Total revenues from North Azadegan have exceeded $1.5 billion.

On the southern sections, he added that it has generated $1.2 billion in revenues since the start of production.

Crude oil output is currently about 75,000 barrels per day and 83,000 bpd from North and South Azadegan, respectively, latest data show.