Iran Ready for $5b In­vest­ment To Boost Oil Pro­duc­tion

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TEHRAN - Iran is pre­par­ing a $5 bil­lion in­vest­ment pack­age for main­tain­ing and en­hanc­ing pro­duc­tion of the coun­try’s oil­fields, Ira­nian Oil Min­is­ter Bi­jan Zan­geneh said.

Ad­dress­ing an en­ergy congress here in Tehran, the of­fi­cial said the pack­age will be pre­pared within the next two years, adding the scheme will in­volve re­pair­ing oil wells and drilling new ones while re­mov­ing pro­duc­tion bot­tle­necks at cer­tain fields. Do­mes­tic com­pa­nies will fi­nance the projects in the pack­age, he added, say­ing that many of the fields are be­ing op­er­ated by the Ira­nian Off­shore Oil Com­pany and the Na­tional Ira­nian South Oil Com­pany (NISOC). The pack­age will be di­vided into smaller pack­ages of $300m projects, each tak­ing 2 years to com­plete, Zan­geneh said. Re­turn on in­vest­ment of the projects will take a pe­riod of at most three years and from the rev­enues gen­er­ated by the projects, he noted. “We will in­vite only Ira­nian com­pa­nies for fi­nanc­ing these projects but they may de­cide to join a for­eign part­ner,” Zan­geneh fur­ther added.

“The cash for de­vel­op­ing the projects will be ob­tained through var­i­ous meth­ods in­clud­ing fi­nanc­ing, us­ance, bonds, do­mes­tic fi­nances and loans from the Na­tional De­vel­op­ment Fund of Iran.”

Im­ple­men­ta­tion of the projects will en­hance Iran’s oil pro­duc­tion while gen­er­at­ing jobs across the coun­try, he stressed, not­ing that the plans will be car­ried out un­der the newly-de­vised model of oil con­tracts (IPC).

The of­fi­cial, who has just been reap­pointed as Iran’s petroleum min­is­ter after Pres­i­dent Rouhani’s re­elec­tion, also said the fate of all of Iran’s joint oil­fields will be de­ter­mined within the next four years.

“The progress of talks aimed at de­vel­op­ing oil fields un­der the IPC is ac­cept­able,” said Zan­geneh in an ad­dress at the open­ing cer­e­mony of the 3rd Ira­nian Petroleum and En­ergy Club Congress and Ex­hi­bi­tion.

He said de­vel­op­ing joint oil­fields is a top pri­or­ity for Iran’s oil in­dus­try, adding the ad­min­is­tra­tion and the Ira­nian Min­istry of Petroleum in­tend to de­ter­mine the fate of all the joint fields within the next four years.

He said the no flar­ing pol­icy of the oil in­dus­try must be ma­te­ri­al­ized dur­ing Pres­i­dent Rouhani’s sec­ond term in of­fice, ex­press­ing op­ti­mism that by the end of the ad­min­is­tra­tion, Iran will have no men­tion­able gas flar­ing. “There are a num­ber of projects in­tended for this mat­ter which are not enough and new plans must be de­fined by adopt­ing suc­cess­ful meth­ods for pre­ven­tion of flar­ing as­so­ci­ated gases. ”Mr. Zan­geneh also touched on the petro­chem­i­cal sec­tor, say­ing a mil­lion tons of feed­stock has been ear­marked for the sec­tor this year.

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