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Iran to double gas production by 2017

Wed, 05.11.2014 14:10



KYIV/Ukraine in Arabic/ Iran is prepared to double its natural gas production by 2017 from the South Pars Gas Field even if Western sanctions against the country stay in place, a senior Iranian energy official says.

Holding the world's largest natural gas reserves, Iran produces as much as 550 million cubic meters (mcm) of gas a day, and work on four phases of South Pars will add 100 mcm by March, Hamid Reza Araqi, managing director of National Iranian Gas Company (NIGC), told.

“Our forecast is that during the winter this year our production will reach 680 million cubic meters,” including output from fields other than South Pars, he said yesterday, without identifying the additional deposits. “Over the next three years, our plan is to increase production to 1 billion cubic meters per day.”

Iran’s economy is hampered by international sanctions imposed over its nuclear program. Revenue from crude exports has plunged since 2012, and financial woes at NIGC have complicated the nation’s efforts to develop its gas resources. Iran is seeking a removal of the curbs on foreign investment in its energy assets as a Nov. 24 deadline for nuclear talks with the U.S. and other world powers looms.

The Persian Gulf country plans to achieve its gas target for 2017 even if sanctions stay in place, Araghi said. South Pars, together with Qatar’s North Field, comprises the world’s biggest gas deposit.

Iraq Market

Iran exports 30 million cubic meters of gas a day, mostly to Turkey, and has signed an agreement to start supplying power plants in neighboring Iraq by April, he said. Exports to Iraq are due to increase to 25 million cubic meters a day in three years, he said.

“Right now we only have a contract to supply Baghdad,” Araghi said. Iran is able to expand supply to include buyers in Iraq’s southern Basra province and the country’s northern Kurdish region, depending on the outcome of talks between the two governments, he said.

Iran isn’t concerned by the deterioration of security in Iraq, as “those are matters for Iraq,” he said. “We will be ready to export gas if they can be ready to receive it from us. If they can’t, then we can use it for our own supply needs.”

Iran also has a $1.3 billion contract with neighboring Pakistan to supply that country with 21.5 million cubic meters of natural gas a day. The project has been on hold as Pakistan has failed to build its section of a shared pipeline because of a lack of funds.

NIGC has restructured its finances since running up debts to banks and contractors under Iran’s previous government, Araghi said, without providing financial details. State-run Mehr news agency reported last November that the company declared bankruptcy with more than 100 trillion rials ($4 billion) in debt.

bloomberg.com

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