for the development of deepwater oil fields in the Gulf of Mexico or development of unconventional shale oil and gas fields is hardly justified. Given the aforesaid points, with the current level of crude oil prices, the risk of investment in oil and gas fields in Iran is low. Oil and gas production costs in Iran are lower than many countries in the world. This issue has doubled the motivation of international companies for investment in the country's oil and gas industry. Meantime, given political tumults and insecurity in Arab countries in the Middle East, Iran's stable political and security situation is creating a proper venue for the development of investment.
Q: What are NIOC's plans for the second phase development of Yadavaran and North Azadegan fields? How likely is the awarding of these fields to Chinese companies?
A: Holding international tender bids for the second phase development of Yadavaran and North Azadegan oil fields is on the agenda. Chinese companies also need to bid for the projects to continue cooperation. China's CNPC is willing to go ahead with the development of North Azadegan oil field. But we have announced that in case of willingness it has to continue its cooperation under new-style contracts and run for tender bids. In the end they accepted this proposal. Regarding the presence of Chinese companies in the development of Yadavaran field we have had negotiations with China's Sinopec and a tender bid is planned to be held for the development of this field.
Q: Are you satisfied with the performance of Chinese company operating in North Azadegan?
A: Generally speaking they have had an acceptable performance. Of course the contract in effect involves only natural production from the reservoir. In future contracts, NIOC will naturally focus on the application of new technologies for enhanced recovery.
Q: Which oil and gas development projects are to come online by the end of the Iranian calendar year (20March 2017)?
A: We are poised to hear good news. In the oil layer of South Pars, wells and offshore facilities are ready for a daily output of 27,000 to 30,000 b/d. A Floating Production, Storage and Offloading (FPSO) unit is being prepared to be brought to Iran from China in February. This equipment has cost around $350 million and its construction has been done on schedule. Phases 17 and 18 development of South Pars are also to be operational before the end of the year. We have also started production from Phase 19. Platform 19C and the platform of Phase 21 are in production. Before the end of the year, Phase 19 of South Pars as well as Phases 20 and 21 would be ready for operation.
Q: Among projects you mentioned, what is the share of oil and gas?
A: By commissioning five standard phases, at least 100 mcm/d would be added to gas recovery from South Pars by the end of the year. After that, the volume of Iran's recovery from this jointly owned field will near Qatar's current gas recovery. In fact, around 120 mcm/d would be added to the South Pars gas production capacity, but we estimate it at 100 mcm/d at least. In the West Karoun area, around 100,000 b/d would be added to the country's oil production capacity. Yaran alone accounts for 30,000 b/d of this increase.
Q: Anything else that you would like to say in conclusion?
A: To sum up, I have to say that in my view we need to activate the Iranian economy. A major element of this economy is oil which needs to be worked on at a higher pace. We need to create national consensus in order to increase investment and work in the petroleum industry and benefit from our advantages particularly in the jointly owned fields and speed up the transfer of technology into the country. We have to accelerate job creation for the youth and persuade young engineers who have left the country in the past years to return.