Delayed scheme needs foreign investment to hit original targets
Iran has increased production to 50,000 barrels a day (b/d) at its Azadegan oilfield in the south west of the country.
In November 2009, production from the field was 35,000 b/d. The increase comes as part of a second stage of the phase one development of the field, which was completed on 6 July.
The second stage of phase one involves 12 wells that have about 20 million barrels of oil so far, Gholamreza Hassan Biglou, managing director of National Iranian Southern Oil Company (NISOC), told state-run news agency Shana.
The first stage of the phase one development, which included the drilling of six wells, the installation of 90 kilometres of pipelines and two oil and gas separator units was completed in 2007, says Biglou.
The field contains an estimated 33 billion barrels of reserves, with 6 billion barrels recoverable.
State-owned China National Petroleum Corporation (CNPC) signed a memorandum of understanding (MoU) with National Iranian Oil Company (NIOC) to develop the northern section of the field in January 2009 and the southern section in August 2009 (MEED 15:1:09).
According to analysts, NIOC is in the process of transferring operatorship of the project from Petroiran Development Company (Pedco), which is being privatized to CNPC. This is despite the lack of a formal contract. CNPC will take a 70 per cent stake in the project along with Japan’s Inpex Corporation with 10 per cent.
NIOC had hoped to reach 150,000 b/d with phase one in 2008 and 260,000 b/d in phase two by 2012, but progress on the field has been slow.
The previous operator, Inpex took a 75 per cent stake in the project in 2004 although this was slashed in 2006, when NIOC took over operatorship. Talks with NIOC stalled in the face of US opposition, disputes over the size of investment and concerns over the safety of the area. The 900 square kilometre area in the Khuzestan province in southwest Iran needed to be cleared of mines from the decade long Iran-Iraq war.
Despite new US sanctions on Iran, Japanese energy firm Inpex Corporation says it has no plans to sell its 10 per cent share.
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