Mar 13 2011 |
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China to Develop Azadegan Fields
China will participate in developing Iran's giant north and south Azadegan oil fields, work that is too expensive for an Iran firm to carry out, deputy oil minister said."Separate contracts for developing the north and south Azadegan oilfields have been inked with the Chinese," Ahmad Qal'ebani said.
He also said the contractor for the two oil fields is the same company, which he declined to name, adding that the amount of investment for the development of the two fields would exceed $6 billion, which is too much for Iranian contractors, Mehr News Agency reported.
"Thorough development of these two giant oilfields requires more than $6 billion and the possibility of procuring such an amount by a domestic contractor does not exist."
In 2009, China National Petroleum Corp (CNPC) signed a memorandum of understanding with National Iranian Oil Co, promising to pay 90 percent of development costs for the South Azadegan oilfield while taking ownership of a 70 percent stake.
An Iranian official said the project needed investment of up to $2.5 billion. Earlier that year, CNPC also won a deal to develop the North Azadegan oilfield. That deal was worth $2 billion in its first phase.
Azadegan is one of the NIOC Recent Discoveries and one of the biggest oilfields that has been discovered in the world in the past thirty years. The field is located 80 km (50 miles) west of Ahvaz close to the Iraqi border.
It holds 33.2 billion barrels of oil in place and 5.2 billion barrels of recoverable reserves. The first exploration well was drilled in the field in 1976, but its discovery was finalized after drilling the second well in 1999. The field has an approximate area of 900 square kilometers (about 350 square miles).
Sarvak, Kazhdomi, Godvan, and Fahilan are productive layers of the field. Crude oil produced by the Fahilan layer is light while the other layers yield heavy crude.
Based on the NIOC plan field is divided in two areas for development north and south.
Oil Swap
Meanwhile, Qal'ebani dismissed media reports that Tehran has decided to stop oil swap with other states, saying the country is prepared to continue oil swap provided that its interests are met.
The Oil Ministry has never ordered the suspension of oil swapping, Qal'ebani said.
Iran swaps oil with many world countries. Iran has swap arrangements with Central Asian producers under which it imports crude into Caspian ports and supplies equivalent barrels to buyers and tanker ships in the Persian Gulf.
On oil bourse, Qal'ebani said "Currently, The National Iranian Oil Company (NIOC) has announced its readiness to offer oil in bourse."
He recalled that oil stock exchange is forecast to be officially launched by April 1. Oil bourse will be launched in three phases, the first phase pertained to exchanging oil by-products which started with trading 2,000 tons of polyethylene on February 17, 2008, he said.
The second phase came on stream through establishing oil and petrochemical products export cycle in Kish Island in 2010, and the third phase will be put into operation by trading crude and Kerosene, he added.
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