Iran’s Oil Ministry has awarded the contract to develop phases 13 and 14 of the South Pars field to the Islamic Revolutionary Guards Corps (IRGC).

A consortium of Khatam al-Anbiya, the engineering subsidiary of the IRGC and local firms will take over from UK-Dutch oil major, Shell Group and Spain’s Repsol, state-run Mehr News agency reports.

On 8 May, the Oil Ministry issued a deadline of 24 May to the UK-Dutch oil major Shell Group and Spain’s Repsol to make a decision on their involvement in the South Pars gas development (MEED 10:5:10).

The local partners in the consortium include Sadra, Khatam al-Ocia, along with state-run National Iranian Drilling Company, according to Ali Vakili, managing director of the Pars Oil & Gas Company.

The IRGC has become increasingly involved in providing domestic contracting services. Reporting directly to Iran’s Supreme Leader, Ayatollah Ali Hoseyni Khamenei, the group is listed as a terrorist organisation by Washington.

Phases 22, 23 and 24 will also be awarded to Khatam al-Anbiya, says Vakili. In 2006, the company signed a $2.3bn contract to develop phases 15 and 16 of the field (MEED 7:7:06).

Shell and Repsol had been in talks with Iran for more than eight years over the development of phases 13 and 14 of the field, but have been reluctant to move ahead due to political pressure from the US. They previously avoided previous Iranian deadlines, by conducting small scale engineering studies and surveys while being careful not to exceed the $20m a year threshold for US sanctions.

The South Pars field contains some 500 trillion cubic feet of gas.