South Pars Turns 20
$80bn Investment Produces $250bn in Revenue
Pars Oil and Gas Company (POGC) was established 20 years ago to develop the giant offshore South Pars gas field, which Iran shares with neighboring Qatar in the Persian Gulf.
Addressing an event to mark the POGC 20th anniversary, CEO Mohammad Meshkinfam said nearly $80 billion had been invested in the gigantic gas reservoir over the past two decades.
“The outcome of such investment has been the production of 1,300 bcm of rich gas from the South Pars gas field. If we value each 1,000 cubic feet at 18 cents the revenue from total production from this field amounts to $250 billion for the past 20-year period,” he added.
Iran’s gas production capacity from South Pars has now reached 600 mcm/d.
Besides South Pars, POGC has been responsible for the development of the North Pars, Golshan and Ferdowsi gas fields.
Iran’s total gas reserves in the South Pars, North Pars, Farzad A, Farzad B, Golshan, Ferdowsi, Balal and Kish gas fields is 673 tcf.
Development of the Kish gas field was recently assigned to POGC. Phase 1 of Kish was developed by the Petroleum Engineering and Development Company (PEDEC) and remaining phases will come online in the future.
There are totally 13 gas refineries in South Pars, 8 of which have so far become ready for commissioning. There are also five refineries in Tonbak and Akhtar (Site 2 of South Pars). Refinery-19 and Refinery-12 have so far become operational.
SP Gas Output Doubles
Meshkinfam said: “Except for SP11, all other border blocks [along the Qatar sector] are operational. By the end of the current [calendar] year [in March 2019], the sour gas production capacity in under-developed phases (SP13, SP14 and SP22-24) would increase.”
Ever since the South Pars development began up to 2013, before President Hassan Rouhani took office for his first tenure, Iran was recovering 285 mcm/d of gas from 110 wells drilled in the field.
In light of the significance of development of jointly owned oil and gas fields, Iran’s Petroleum Ministry focused on this field. Under the first administration of Rouhani, 10 phases became operational.
“The gas production capacity from this joint field has reached 600 mcm/d from 267 wells, and has more than doubled,” said Meshkinfam.
“Furthermore, with the operation of four gas condensate storage facilities in South Pars with a total capacity of 2 million barrels, the condensate storage capacity in South Pars has practically increased,” he said.
Total sour gas production from South Pars has reached 1,348 bcm over the past two decades. The figure was 596 bcm up to 2013, which means it has more than doubled in five years.
Gas Output Up 85 mcm/d
Meshkinfam said since 2013gas production has accelerated in South Pars, adding that Iran’s recovery from South Pars experienced a 372 mcm/d increase over five years.
National Iranian Oil Company (NIOC) is required to add another 85 mcm/d increase to the South Pars gas output by the end of the current calendar year.
“So far, SP14 has seen its output increase 28 mcm/d. Another 56 mcm/d increase is expected to materialize by February 2019,” said Meshkinfam.
Currently, three sweetening trains in SP13 and SP22-24 are operational. The last sweetening train in SP13 has also become operational. The last train of SP22-24 will come online by February 2019.
Meanwhile, the third offshore platform in SP14 will be installed and launched by next March to bring its production capacity to 42 mcm/d.
SP11 Operator Changing
A nearly $5 billion agreement for the development of SP11 was signed in July 2017 between NIOC and a consortium of France’s Total, China’s CNPC and Iran’s Petropars.
After US President Donald Trump walked away from the 2015 Iran nuclear deal, which had lifted sanctions on the country to allow for foreign investment, Total pulled out of the project due to US threats of penalties.
Meshkinfam said the Total-led consortium spent nearly $90 million in SP11 with the French giant accounting for about $45 million.
Regarding the future of SP11 development, he said: “The process of assignment of SP11 development from Total to CNPC is in its final stages.”
He added that the contractor for SP11 development would be known by next March.
“Since the signature of the agreement, Total has designed compressor technology for Iran. Therefore, we can say that the preparations for using hits technology to construct gas compression platforms have been made in Iran, which is a great achievement,” said Meshkinfam.
He added that necessary documents related to the technology needed for building gas compression platforms have been submitted to CNPC.
Building nearly 20,000-tonne gas compression platforms was a new experience for Total as few countries have already experienced such platforms, he said, adding: “The first step in building such platforms has to be taken properly because such heavy platforms are also to be built in other South Pars blocks.”
Meshkinfam touched on the jacket built by Petropars for SP11 development, saying: “This jacket is situated in the Qeshm Island yard. After the conclusion of studies on Block 11, it will be installed at 11B location.”