Iran seek­ing to sign its first FLNG deal with Nor­way

Iran Daily - - Domestic Economy -

Iran, the world’s big­gest gas re­serve holder (33.5 tril­lion cu­bic me­ters, 18 per­cent of the to­tal) has in­creased its gas out­put sig­nif­i­cantly and is tar­get­ing an out­put of 1 bcm/d by March 20, 2018.

Iran prefers to ex­port liq­ue­fied nat­u­ral gas (LNG) to dis­tant mar­kets in­clud­ing the EU, but no agree­ment has yet been reached on the con­struc­tion of plants for the pur­pose, re­ported Trend News Agency.

The coun­try’s sole LNG project, the 52-per­cent com­pleted ‘Iran LNG’ needs an in­vest­ment of about $8-10 bil­lion and talks with for­eign in­vestors haven’t yielded any re­sults so far.

Last year, Man­ag­ing Di­rec­tor of Na­tional Ira­nian Oil Com­pany Ali Kar­dor said that Iran is tar­get­ing ex­ports of 0.52 mil­lion met­ric tons per year (MT/Y) of LNG us­ing mini-lng plants and float­ing LNG ves­sels (FLNG) — Iran’s al­ter­na­tive projects to ex­port LNG.

The coun­try has signed a mem­o­ran­dum of un­der­stand­ing (MOU) with South Korean Ko­gas on the de­vel­op­ment of LNG projects as well as with Na­tional En­ergy Ad­min­is­tra­tion of China on de­vel­op­ing mini-lng projects.

How­ever, talks on pur­chas­ing or man­u­fac­tur­ing float­ing liq­ue­fied nat­u­ral gas (FLNG) ves­sels in re­cent months have so far yielded no re­sults.

Now, Kar­dor says that Iran’s first deal on the con­struc­tion of a FLNG fa­cil­ity will soon be signed with a Nor­we­gian com­pany.

The 20-year deal is in­tended to pro­duce 500,000 tons of LNG, Kar­dor said on Oc­to­ber 10, adding that pric­ing for­mula of the prod­ucts will be de­ter­mined by the Oil Min­istry.

He did not dis­close the name of the Nor­we­gian firm, but last year it was an­nounced that Tehran is ne­go­ti­at­ing with Nor­we­gian Go­lar and Hemla Van­tage com­pa­nies. Go­lar owns one of the largest FLNG fleets in the world, while Hemla Van­tage was keen to lease a FLNG ves­sel from a Bel­gian com­pany, Ex­mar, to col­lect and liq­uefy flar­ing gas in off­shore fields around Kharg Is­land in the Per­sian Gulf (the amount of yearly col­lec­tion and liq­ui­da­tion of flar­ing gas in Kharg Is­land can stand at 0.5 MT).

Launch­ing FLNG and mini-lng fa­cil­i­ties will help Iran di­ver­sify and ex­pand its nat­u­ral gas mar­ket.

The projects will also grant the coun­try chance to con­vert its flar­ing gas (mostly from burn­ing as­so­ci­ated gas in the oil sec­tor), which cur­rently amounted at about 11 bil­lion cu­bic me­ters per year (bcm/y), into LNG.

SHANA

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