28 Oil/Gas Reservoirs NISOC Priority
National Iranian South Oil Company (NISOC) is a subsidiary of National Iranian Oil Company (NIOC), accounting for 80% of Iran’s total oil output.
The priorities envisaged by current NISOC managers pertain to human resources, social corporate responsibility, health, safety, environment (HSE), maximum efficient recovery and ageing hydrocarbon reservoirs and their installations.
“Following Petroleum Ministry and NIOC approach, we started operation-based mode [for development of fields] alongside development-based or field-based models two years ago,” Ahmad Mohammadi, newly-appointed CEO of NISOC, told "Iran Petroleum".
He added that due to the high number and diversity of the fields run by NISOC, as well as the geographical extent of hydrocarbon resources, the company gave priority to the preparation of projects and development plans by focusing on the development of a large number of these fields during a short period of time.
“After receiving primary green lights, we received necessary permits from NIOC and other sectors in order for these fields to be awarded to new contractors cleared by the Petroleum Ministry within the framework of EPCF and EPDF models,” said Mohammadi.
He said some 28 reservoirs were short-listed within the framework of 27 packages.
“In addition to production objectives, an objective constantly pursued by the Petroleum Ministry in the development of these fields has been job creation, creation of business environment and employment of untapped potential in oil-rich areas, particularly in Khuzestan Province and other oil-rich provinces,” he said, adding that this significant objective would be reached after new contractors would start work.
Mohammadi said the Mansouri oil field had been put out to tender in November and “the successful bidder was chosen and an agreement will be signed with an Iranian company soon.”
“The Ahvaz-2, Ahvaz-3 and Ahvaz-5 packages have been assigned to another qualified Iranian company. In a unique measure, five tender bids were launched in a single day recently for Ramshir, Lali Asmari, Kaboud, Balaroud and Gachsaran Khami reservoirs with their successful bidders have been known,” he added.
The tender for the Mansouri-Asmari package was valued at IRR 13 billion and the tender for the other five projects totaled IRR 27 billion.
Three percent of the value of contracts will be allocated for the construction of location and seven percent for the supply and manufacturing of commodities and equipment. The six packages are expected to become operational by early next calendar year.
Each drilling rig will create more than 200 direct jobs, while hundreds of others will be employed in other projects including the construction of locations, installations and pipe manufacturing.
“Besides production and business environment, a major objective pursued in the development of the 28 reservoirs is to support Iranian companies, Iranian-made commodities and attract Iranian investment,” said Mohammadi. “We welcome the participation of foreign investors and companies to finance the projects and invite them in.”
Referring to the mechanism worked out for the implementation of production enhancement contracts, he said: “An integrated and all-inclusive project will be awarded to the contract altogether, and the project is executed by the contractor who also provides equity.”
“Then, after the completion of each section, the costs will be compensated,” he added.
Mohammadi said the client would be responsible for the monitoring of the job in terms of both quantity and quality. But, he added, the client would have no role in the supply of commodities and “the contractor will be responsible for the operation from A to Z.”
“The client will monitor the process of work technically and operationally and receives progress report from the contractor,” he said.
Mohammadi said the 28 reservoirs run by NISOC are estimated to cost IRR 350,000 billion for development. He added that finalization of six tenders so far would give rise to significant developments in terms of job creation and reinforcement of infrastructure in Khuzestan Province.
“The client has undertaken to earmark 4% of the value of each contract for priority social responsibility projects including combating haze, reinforcing the infrastructure, education and so on,” he said.
Mohammadi said the role defined for NISOC in social responsibility would be supporting executive bodies and organs which have their own budget share.
“In light of the geographical extent of NISOC, covering the five provinces of Khuzestan, Kohguiluyeh Boyer Ahmad, Bushehr, Fars and Ilam, valuable work has so far been done,” he added.
“Our special job has been to identify underprivileged areas and give them priority so that in cooperation with local and provincial officials we would be able to make social responsibility projects materialize within the framework of a cohesive timeframe for the residents,” said Mohammadi.
He said that sustainable development and security would definitely materialize through paying attention to local inhabitants.
“I have serious plans in this sector and through an interactive approach with local officials I will prioritize areas which are faced with infrastructural problems,” said Mohammadi.
He said that a Social Responsibility Committee would be established soon at NISOC to focus on this sector in cooperation with residents and local people.
“We believe that human resources are not limited to petroleum industry manpower. The same people who are active around our installations, the same people who see flares when they sleep at night and who see derricks, installations and pipes when they wake up, the children who see oil installations as soon as they are born and learn walking by touching oil pipes are all human resources,” he said.
EOR Tops NIOC Agenda
Mohammadi said enhanced oil recovery (EOR) was an issue which should be pursued seriously.
“NISOC has long been injecting gas into 50-60% of oil fields it runs,” he said, adding that gas injection had improved the rate of recovery from the Gachsaran Bibi Hakimieh, Parsi Pazanan, Haftkel Aghajari and Maroun reservoirs.
“Meantime, in order to enhance recovery, we plan certain pilot measures in the 28 reservoirs. After receiving results, we will be able to take field-scale steps for enhancing the rate of recovery,” Mohammadi said.
“One of NISOC priorities with regard to plans drawn up by Petroleum Ministry and NIOC has been to seriously follow up on flare gas gathering,” he said.
He expressed hope that flares would be turned on just whenever necessary “because we cannot reach absolute no flaring”.
“One of appropriate measures taken to that effect was in the Ahvaz 3 production unit to make the flares smokeless. That has had economic benefits in addition to protecting the environment,” he said.
Mohammadi said HSE was a NISOC priority, adding that renovation of installations was a must as some of them are more than half a century old.
“Most of rotary machinery and oil pipelines are ageing and they need to be renovated. That is a priority for Petroleum Ministry and NIOC,” he said.
He warned that non-renovation of the decrepit installations would affect the function of installations and trigger life-threatening threats.
“We have to be very careful and observe protocols,” said Mohammadi.
He said that Iran’s southern oil-rich zones, which are now 110 years old, and the machinery which was first used in the petroleum industry would be attractive to everyone.
“I believe that industrial tourism is an issue that has been neglected. By benefiting from this potentiality in this sector, we can attract tourists so that in addition to the younger generation, everyone else would also know the history of petroleum industry which was born in Masjid Soleyman,” he said.
“It would not be wrong to say that the fundamentals of reservoir engineering, petroleum engineering, processing and bi-phase fluids have their roots partly in Iran and Masjid Soleyman, Aghajari and Haftkal, and therefore they owe Iran,” added Mohammadi.