$5bn Package for Iranian Companies
The third annual Congress of the Iran Petroleum and Energy Club (IPEC) was held October 10-12 in Tehran.
Addressing the opening ceremony, Iran's Minister of Petroleum Bijan Zangeneh said a $5 billion package had been drawn up to enhance production from operating oil fields in Iran.
"In order to preserve and enhance production from operating fields in Iran, we are preparing a $5bn package over two years," he said.
"This package is exclusively for Iranian companies; however, they can choose foreign partners for financing," the minister said.
He added that the billion-dollar package was complementary to Iran's new model of oil contracts – Iran Petroleum Contract (IPC) – which require foreign companies to have an Iranian partner for operating oil projects in Iran.
"Preparation of this package and implementation of these projects would be apart from projects that would be implemented" under IPC framework, Zangeneh said.
The package, he added, would mainly be spent on workover of oil wells, drilling new wells, surface debottlenecking, and operation. A variety of fields run by the National Iranian South Oil Company (NISOC), the Iranian Central Oil Fields Company (ICOFC) and the Iranian Offshore Oil Company (IOOC) would be covered by this package.
"This $5bn package will be divided into smaller packages which would worth $300 million at most," said the minister.
Zangeneh added that these projects would be implemented in two years' time with reimbursements to be made from project revenues in less than three years.
He referred to financing, usance, bonds, domestic financing and getting loans from the National Development Fund of Iran (NDFI) as some methods of financing.
IPC Talks in Good Stage
Zangeneh gave a positive and acceptable assessment of negotiations under way for the development of oil fields within the framework of IPC contracts.
"The policy pursued by the government and the Ministry of Petroleum is to finalize the case of all jointly owned fields within four years and determine contractors for their development. That's a big stride," he said.
Zangeneh expressed hope for the signature of contracts with leading foreign companies to develop jointly owned fields. He noted that foreign companies would have to work with Iranian partners.
The minister said development of oil fields in the West Karoun area in western Iran and enhanced recovery from operating fields were among priorities of Iran's petroleum industry.
Petchem Needs Attention
Iran's petrochemical sector was also highlighted by Minister Zangeneh. He said the Ministry of Petroleum called for enhanced production capacity at petrochemical plants and paying further attention to mid-stream and downstream sectors of petrochemical industry.
"We need to activate these industries in cooperation with the Ministry of Industry, Mine and Trade," he said.
Regarding construction of oil refineries, he said: "We don’t need oil refineries for domestic consumption. Any new refinery must be used for exporting petroleum products. Of course, the existing refineries need optimization in order to see convergence between the quality of products and new standards,"
No Flaring
Zangeneh also highlighted the significance of no flaring, expressing hope that flaring associated petroleum gas would have been minimized by 2021, when his ministerial term ends.
He referred to NGL 3100