The National Iranian Oil Company is ready to conclude agreements worth $700 million with knowledge-based companies to enhance the production of 750 oil and gas wells across the country, managing director of the state-run firm said.
"As soon as the government's Economic Council issues the necessary permits, several contracts will be signed and startups can play a bigger role in the energy sector,” Mohsen Khojastehmehr was also quoted as saying by IRNA.
NIOC is determined to create opportunities for startups and pave the way for knowledge-based firms so that they can bolster different sectors of the oil and gas industry, especially those active in manufacturing pipes, turbines and compressors, he added.
According to the official, deals worth $100 million were clinched with universities and technology-driven business owners in 2021 and more contracts will be drawn up soon.
NIOC has completed the construction of a new technology park in Shahr-e Rey in southern Tehran, indicating that it plans to support startups and university-based firms in oil-related industries.
According to the officials, the tech park is aimed at injecting state-of-the-art technology into the domestic petroleum industry and enriching the industry with the know-how generated by universities and research institutes.
It plans to host and support knowledge-based companies and startups for developing smart ideas to upgrade petroleum technologies, develop markets, create jobs and boost their capacities in the key sector.
Tech teams entering the park can enjoy legal and tax exemptions and up to 5 billion rials ($20,700) of seed money supplied by the Iran National Innovation Fund, affiliated with the Vice-Presidency for Science and Technology.
Of the 5,700 knowledge-based companies in Iran, 1,418 are involved in information and communications technologies, 1,267 in machinery and equipment and 1,111 in electronic products.
Creating Jobs, Earning Revenue
There are more than 5,500 oil and gas wells in 400 oil and gas fields of the country and by using the expertise and new technologies of knowledge-based establishments, it is possible to create jobs and income, especially in underprivileged regions.
“Using the capabilities of knowledge-based companies, we will be able to add at least 80 million barrels of oil to NIOC’s annual production that currently stands at around 1 billion barrels,” he said.
Speaking about the petroleum exports, Khojastehmehr said about 50% of exports are unprocessed or semi-processed products, which is not good for the country, so the use of knowledge-based companies in this field, in addition to generating value added, can create employment and earn revenues for the country.
Iran is striving to increase the export of oil and byproducts, despite sanctions imposed by the United States on Tehran's crude sales.
The draconian US sanctions have made it impossible for international companies to cooperate with Iran. As a result, local firms and startups have been emerging to help address the oil industry challenges.
Knowledge-based companies and startups are expected to propose creative ideas for reducing production costs and boosting productivity in the key industry. The ministry’s Research and Technology Department is tasked with facilitating their activity.
“Startups have already indigenized key catalysts and essential equipment and parts for the petrochemical and drilling sectors,” he said.
According to Mohammad Sadeq Khayyatian, an official with Iran National Innovation Fund, due to its overdependence on oil revenues, Iranian governments did not pay attention to the revenue-generating potential of knowledge-based firms.
Khayyatian said that has now changed and Iran is increasingly counting on the technology ecosystem for creating wealth and the government is also increasing its financial support to knowledge-based companies.
Tax Exemption
The government is planning to offer tax and customs exemptions to high-tech firms, ease the cumbersome process of issuing commercial licenses, cut social security insurance costs, reduce the obligatory military service duration [for tech enthusiasts] and help empower innovative business, he said.
According to Iran’s Research Institute of Petroleum Industry, affiliated with the Oil Ministry, two knowledge-based companies signed contracts in February with RIPI to inject new technologies in the petrochemical sector.
The institute is planning to work with Azma Sanj Pishro Company (ASP) in Tehran to transfer the knowledge of water- and oil-based nanofluid production.
RIPI, in return, has committed to provide technical consultation and support, commercialize ASP’s petrochemical products, make research and development investments and expand the tech firm’s market.
The second contract was signed with Toftech company operating in Isfahan, the institution said.
Toftech’s major mission is the manufacture of advanced scientific devices used in laboratories, including mass and ion-mobility spectrometers.
Another knowledge-based company, based in Fars Province, has produced a special composite wrap to repair old oil, water and gas pipelines without taking them out of service, a member of the board of directors at Faratec Novin Parseh knowledge-based firm, a subsidiary of Farassan Manufacturing and Industrial Company, said.
“The new fiber-reinforced polymer composite is a permanent, cost-effective pipeline repair technology, suitable for defects such as pits, dents, gouges and external corrosion. The FRP composite can extend the lifespan of pipelines to 50 years,” Ali Elhamian added.
This technique is quick and less costly than other repair options and permanently restores the pressure-containing capability of the pipe when properly installed.
“The composite wrap can serve as an alternative to the traditional pipeline repair practices such as pipeline replacement, or the installation of full-encirclement steel split sleeves,” he said.
Composite wrap systems allow pipeline repair without shutting down gas, oil or water flow, purging the pipeline, or cutting into the pipe.
