Post-Sanctions Iran to Broaden Ties
Iran will expand its economic cooperation with the world owing to the planned removal of sanctions on the Islamic Republic, a senior nuclear negotiator said.
“Undoubtedly, after [the lifting of] the sanctions, we will witness a new era in Iran’s economic cooperation,” Abbas Araqchi said.
He added that the Vienna agreement will clear the way for economic cooperation between Iran and many other countries that had been deprived of cooperation with Iran due to the sanctions.
Araqchi said neighboring countries and “countries lying on our transit route will have a special place.”
He singled out Republic of Azerbaijan, saying Iran would be willing to boost ties with the breakaway republic of the former Soviet Union.
Araqchi said Azerbaijan can help Iran and Europe improve ties, adding that Azerbaijan will have a special place in Iran’s future economic interactions.
He also referred to the prospects of Iran-Turkey relations, saying: “Iran’s relations with Turkey are strong, deep-rooted and broad and the relations between the two countries will continue in full strength.”
Araqchi noted that there are some “serious” differences of view between Iran and Turkey on regional affairs, “but it does not mean that the relations between the two countries are off the track.”
“In the wake of Vienna agreement, this cooperation will be broader and further. Like Azerbaijan Republic, Turkey is located between Iran and Azerbaijan Republic and it will play a significant role in the expansion of trade relations between Iran and Europe,” he said. Araqchi said that the “progressive” relations which were developed between Iran and Turkey during years of sanctions will continue.
He also said that Iran’s relations with Russia and China are “strategic, positive, constructive, significant and progressive.”
Shell Eyes Iran Investment
With a nuclear deal in hand, Royal Dutch Shell said it is exploring the "immediate and long-term" implication of an opening Iranian oil door.
The announcement came after representatives from the five permanent members of the UN Security Council, Germany and Iran announced the signing of a breakthrough agreement.
Nureddin Wefati, a spokesperson for Middle East operations at Shell, said in response to email questions his company was setting the early stage for working with or in Iran.
"We are engaging with relevant governments to understand the immediate and long term impact of the latest agreement on the sanction regime, understanding that further steps are required before any sanctions are lifted or suspended," he said.
Shell maintained oil ties to Iran through pre-existing contracts before the European Union placed an embargo on Iranian crude oil mid-2012.
"Shell continues to comply with all relevant international sanctions," Wefati said. "At the same time, strictly within the boundaries of the law, we are interested in exploring the role Shell can play in developing Iran's energy potential."
South Pars Output Up 500 mcf/d
Production capacity of the South Pars gas field has enhanced by 500 mcf/d, managing director of Pars Oil and Gas Company said.
Ali-Akbar Shabanpour said production from the satellite platform of Phase of South Pars is under way at a trial rate of 400 mcf/d.
He said that following the successful completion of drilling of four new wells in the satellite platform of Phase 1 of South Pars and the equipment of production platform in this sector in line with production capacity, the volume of gas production in this platform increased by 500 mcf/d.
Shabanpour said the grounds are prepared for enhanced recovery from hydrocarbon reserves held in South Pars which is jointly operated by Iran and Qatar.
Iran sits on the world’s 4th largest oil reserves and the second largest gas reserves.
South Pars, divided into 29 development phases, contains 40 trillion cubic meters (tcm) of natural gas. It covers an area of 9,700 square kilometers, 3,700 square kilometers of which is in Iran’s territorial waters in the Persian Gulf. The remaining 6,000 square kilometers is situated in Qatar’s territorial waters.
The gas field is estimated to contain about eight percent of the world’s reserves, and approximately 18 billion barrels of condensate.
Investment in Iran Oil Sector Alluring
A deputy minister of petroleum has said that a 20% rate of return offered by Iran for investment in Iran’s petroleum sector is attractive for foreigners.
“In foreign countries, the rate of return on investment in banks is around one percent while this rate is at least 20% for investment in Iran’s petroleum industry projects,” Abbas Sha'ri-Moqaddam said.
He added that foreign investors have already shown interest in investing in Iran’s petroleum industry.
Sha'ri-Moqaddam, who is also head of National Petrochemical Company (NPC), said. However, he said the interest rate for banking deposits in Iran is around 27%, higher than the 20% for investment in oil projects.
He said the infrastructure should be prepared for the presence of foreign investors, adding that this infrastructure has requirements.
“If we intend to help potential financiers invest in Iran, we have to stick to three principles; first is setting price on feedstock for the long-term to be competitive with rival countries, second is the government’s preparation of the infrastructure and third is the stability of rules,” he added.
Sha'ri-Moqaddam said Management and Planning Organization (MPO), Ministry of Petroleum and Ministry of Industry, Mine and Trade are involved in petrochemical feedstock pricing.
He added that following the signature of a historic nuclear deal between Iran and six world powers, foreign investors are wondering about petrochemical feedstock price.
NPC managers have held talks with Asian and European investors in recent weeks for investment in Iran’s petrochemical industry.
Finance, technical knowhow and marketing of petrochemicals have been the main subjects of discussion between Iranian officials and foreign investors.