Iran, Iraq Agree on Border Oil Fields Development
Iran and Iraq have reached understanding on the development of two oil fields they share along their borders. “Negotiations pertaining to the development of the jointly owned Naftshahr and Khorramshahr oil fields are done and we have now reached a point where we can set up the framework for an official agreement for their development together,” Iranian Petroleum Minister Bijan Zangeneh said. He made the remarks while along with his Iraqi counterpart Thamer Al Ghadban was visiting the Energy Intensive Engineering and Design Company (EIED), affiliated with the Oil Industries Engineering and Construction Company (OIEC), in Tehran There is great potential for the development of Iran-Iraq cooperation in the oil, gas, refining and petrochemical sectors, and Iran is ready to share its potentialities with the Iraqi petroleum industry,” said Zangeneh. He said OIEC and an Iraqi mirror company would explore opportunities for cooperation. He added that Iran was ready to help Iraq develop its gas and petrochemical sectors.Zangeneh also said that Iraq owed Iran $1 billion in gas debts. Iran-Iraq CooperationIran’s deputy minister of petroleum for international affairs and commerce, Amir-Hossein Zamani-Nia, said Iran and Iraq had held negotiations for cooperation in the oil, gas, refining and petrochemical sectors. He said Minister Zangeneh and President Hassan Rouhani had discussed cooperation areas during their separate visits to Iraq. “Pursuant to these negotiations, Iran and Iraq signed a memorandum for cooperation. Based on this memorandum, Iran would be providing technical and engineering services to Iraq to rebuild its old refineries and establish a gas supply network. The two countries would also develop joint fields,” he said. Zamani-Nia said political developments had provided the best time for the development of cooperation between the Iranian and Iraqi oil sectors. “Given Iran’s petroleum engineering technical potentialities it is possible for our country to export technical and engineering services to Iraq. Furthermore, due to Iran’s unique standing in the gas supply network development, the document lays emphasis on the utilization of Iran’s experiences and potentialities for setting up a gas distribution network in Iraq,” he added. He said a long-awaited oil pipeline linking Iran’s Abadan with Iraq’s Basra would become operational soon.Under the memorandum, Iraqi students would come to Iran to study petroleum engineering at the University of Tehran. Zamani-Nia was asked about the possibility of non-extension of US waivers to buyers of Iran’s oil. He said: “I don’t comment now, but there is almost consensus that the oil market is not stable and stagnant; rather, it is very tense and gasoline prices at US gas stations would determine whether or not such waivers would be extended.”EIED ‘Remarkable’The Iraqi oil minister heaped praise on EIED, saying: “I realized that this company is very qualified. They are competent in the engineering and design of oil, gas and petrochemical projects.” “I was impressed to get to know about EIED’s activities in the oil sector. This company’s experts remain as strong as they were before the [US] sanctions [were re-imposed]. They are doing their utmost in the implementation of projects in the oil fields, designing as well as operation. That’s remarkable,” he said.Al Ghadban said he had travelled to Tehran to explore grounds for cooperation with Tehran. “It is not the first time we are working together and exchanging views and thoughts.” “We have an institute similar to EIED. We will soon send a delegation to Iran to sit together [with Iranians] and exchange ideas and thoughts and examine ways and methods of cooperation,” he said. “That would be in designing, construction and even operation, either individually or jointly.” After a meeting with visiting Iraqi Prime Minister Adel Abdul Mahdi, President Rouhani called for increased volume of trade between the two countries. Rouhani called for Iran and Iraq to expand their gas, electricity and oil dealings and boost bilateral trade to $20 billion, despite difficulties caused by US sanctions against Tehran. “We hope that our plans to expand trade volume to $20 billion will be realized within the next few months or years,” Rouhani said. The current level of Iran-Iraq trade stands at about $12 billion. The energy industries in the two countries have close links and Iraq relies heavily on Iranian gas to feed its power stations. Iraq imports roughly 1.5 billion standard cubic feet of gas per day from Iran via pipelines in the south and east of the country. During the trip to Iraq last month by Rouhani and Zangeneh, Iran had agreed to help Iraq with technical and engineering services in the oil sector. US President Donald Trump re-imposed sanctions on Iran’s energy exports in November, but simultaneously granted waivers to several buyers to meet consumer energy needs. In March the United States granted Iraq a 90-day waiver exempting it from sanctions on buying energy from Iran.Iranian Energy Minister Reza Ardakanian said Iraq has cleared 90 percent of its electricity dues to Iran.“During the past 15 years, Iran exported $6 billion of electricity to Iraq and the country has paid 90 percent of its arrears to us in this period,” Ardakanian said at Iran-Iraq Business Forum held in Tehran.“We hope that we can continue electricity exports to Iraq in 2019-2021, as it is pre-planned in the joint signed agreement,” he added.