Norwegian oil and gas operator DNO has become the latest western firm to study Iran’s oil and gas assets following the lifting of nuclear-related sanctions against the Islamic republic. 

The Middle East-focused energy company signed a Memorandum of Understanding (MoU) with the National Iranian Oil Company (NIOC) to examine possibilities for development of the western Changuleh oil field.

Located in the Lorestan province bordering Iraq, the oil field is estimated to hold two billion barrels of oil reserves.

“Iran presents an obvious and exciting next step in expanding DNO’s footprint in the region,” said Bjorn Dale, managing director at DNO in a statement.

DNO has interest in oil and gas in neighbouring Iraq.

NIOC estimates that the development could take place over two phases, with an initial plan for drilling six wells.

Russian firm Zarubej Neft had earlier expressed interest in the Changuleh oil field, reported Shana, the Iranian petroleum ministry’s news agency in October 2016.

Prior to the nuclear sanctions, in November 2009, Russian oil giant Gazprom and NIOC had signed an MoU to study the development of the Changuleh and Azar oilfields.

However, in August 2011, after new sanctions came into effect, Iran decided to operate its fields using local consortia and cancelled its agreement with Russia, citing Gazprom’s failure to meet obligations.

A previous agreement between Russia’s Lukoil and Norwegian Statoil to develop the Anaran block near the Iraqi border was written off because of international sanctions.

DNO’s agreeement follows announcements by Total and Polish firm PGNiG to develop Iran’s energy assets.

The French energy giant signed a Heads of Agreement with NIOC in November to develop phase 11 of South Pars, the world’s largest gas field, along with China National Petroleum Corporation.

Polish state-owned oil and gas firm PGNiG signed an MoU to study the western Sumar oil field.