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Iran Bans IOOC From Working On Disputed Gas Field

Oil Rig

The foreign ministry of Iran has banned the Iranian Offshore Oil Company (IOOC) from performing any work at a gas field that Iran shares with Saudi Arabia and Kuwait, according to the Iranian company’s managing director.

IOOC managing director Hamid Bovard has said that the company has been prohibited from doing any work at the Arash field—as Iran calls the field, Azeri Trend News Agency reports, quoting Iran’s news agency Mehr.

The field is known as Dorra in Kuwait and Saudi Arabia.

The work stoppage was called amid a dispute over geographical borders that still needs to be settled, with Iran banning all activity on Iran’s side of the field, according to Bovard.

The Dorra field is located in the Partitioned Neutral Zone (PNZ), which Kuwait shares evenly with Saudi Arabia. Dorra is the extension of the Arash field, as it is known in Iran.

Kuwait and Saudi Arabia had planned to begin production at Dorra by 2017, but they shelved the project in 2013 due to a disagreement over transportation and allocation of resources.

Dorra contains an estimated trillion cubic feet of gas and 310 million barrels of oil.

Earlier this year, Iranian media reported that according to an official at the National Iranian Oil Company, Iran’s foreign ministry had opened dialogue with the Kuwaiti and Saudi governments, in a very early step toward developing the joint field.

Previous political disputes over the field included Kuwait summoning the Iranian charge d'affairs to officially protest over reports that Tehran had published a brochure on opportunities for investment at the joint field.

Related: Four Charts That Explain OPEC’s Fall From Power

Last week, the executive director of the Iranian Offshore Oil Company said that the company would increase production at the Foroozan oil field, which Iran shares with Saudi Arabia, by 12,000 barrels daily, adding that Iran will install two platforms at the field soon. Tehran has 11 percent of the field—which Saudi Arabia calls Marjan—whose reserves are estimated at 2.3 billion barrels. Iran and Saudi Arabia share another field in the Persian Gulf—Lulu, which is known as Esfandiyar in Iran.

By Tsvetana Paraskova for Oilprice.com

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