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Gazprom Replaces StatoilHydro In Azar Field Development

Iran’s Petroleum Engineering and Development Company (Pedco), a subsidiary of the National Iranian Oil Company (NIOC), announced on 2 November that it has signed a preliminary agreement with Gazprom regarding the development of the Azar oil discovery on the Anaran block in Ilam province. The announcement followed the decision by Norway’s StatoilHydro to waive an option to develop the field, which has estimated oil reserves of 400mn barrels. StatoilHydro had begun talks with Pedco with a view to developing the field to produce 50,000-65,000 b/d of oil, but decided “to suspend work on this project” despite the fact that the exploration phase “resulted in promising commercial discoveries in recent years” according to a press statement released on 30 October. The statement added that the company “will not make any further investment in Iran in the current situation. We have reduced our activities in Iran over the last year.” StatoilHydro had also made the Changuleh oil discovery on the Anaran block, thought to be similar in size to Azar.

Pedco Managing Director Nadi Sadouni told reporters on 2 November the company “has recently signed a memorandum of understanding (MOU) with Russia’s Gazprom for the development of Azar oil field. The Russians must present their plan for the development of Azar within three months.” StatoilHydro was operator of the Anaran license with 75% equity, while Russia’s Lukoil held the other 25%. StatoilHydro has been reluctant to press ahead with its Iran projects because of tightening international sanctions and its listing on the US Securities and Exchange Commission (SEC – MEES, 23 April 2007).

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