WTI Crude

Loading...

Brent Crude

Loading...

Natural Gas

Loading...

Gasoline

Loading...

Heating Oil

Loading...

Rotate device for more commodity prices

Iran Launches New Development Phase For South Pars

Offshore

Iran’s President Hassan Rouhani announced the start of phases 17-21 at its giant offshore South Pars gas field—a development stage worth $20 billion. Rouhani told media that gas output from the field had reached 570 million cu m and that Iran had plans to overtake Qatar as gas producer.

Currently, Iran produces 885 million cu m of gas daily—almost the same as Qatar—but most of it is being consumed domestically. Oil fields need gas injections to increase output, so much of what Iran is producing from its gas deposits is being used to stimulate oil production. According to BP data, gas exports have yet to become viable given the current level of domestic natural gas consumption.

Still, Iran has ambitions to become a major gas exporter, beginning with 50 million cu m daily to neighbor Iraq, as soon as the latter arranges payments for the exports.

Qatar is not wasting time ramping up its own output, however. Last month, Doha removed a 12-year ban on new drilling in its part of the South Pars, which it calls the North Field. Qatar Petroleum announced it will begin work on a new project that should add 2 billion cu ft of natural gas to the country’s daily exports, increasing the production capacity of the North Field by 10 percent.

Qatar is the world’s top LNG exporter and has clear intentions to keep the top spot.

At the South Pars inauguration Zanganeh said Iran has no worries about Qatar’s new drilling at the North Field: “They can carry out their development projects as we do ours,” he said, as quoted by Bloomberg. “We do our job and let them do theirs.”

Related: China Ready To Cut Oil Supplies To North Korea

In this job, Iran has enlisted the assistance of China’s CNPC and France’s Total, which said last month in a regulatory filing that it wanted a 50-percent stake in South Pars and was willing to pay $4 billion for it. Yet the company has postponed its final investment decision, waiting to see how President Trump’s anti-Iran rhetoric develops.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage

Leave a comment

Leave a comment

Oilprice - The No. 1 Source for Oil & Energy News