Energy, Economy

Iran, Norway Sign Caspian Sea Oilfield Study MoU

Iran, Norway Sign Caspian Sea Oilfield Study MoUIran, Norway Sign Caspian Sea Oilfield Study MoU

Norway's Offshore Resource Group signed a memorandum of understanding with Khazar Exploration and Production Company to the study the development of Sardar-e Jangal oil and gas field off Gilan Province in the Caspian Sea as well as the offshore exploratory blocks of 24, 26 and 29.

The agreement was signed by Jostein Kaare Kjerstad, ORG's executive director and KEPCO's managing director, Mohsen Delaviz in Tehran on Tuesday at the presence of Norwegian Ambassador Lars Nordrum, Deputy Oil Minister for International Affairs Amirhossein Zamaninia as well as Gholamreza Manouchehri, deputy for development and engineering at the National Iranian Oil Co., Shana reported.

Pointing to the long history of Norwegian companies' presence in Iran's oil and gas industry, Nordrum noted that the agreement marks the beginning of a potentially extensive collaboration between the two countries' energy companies.

"Oslo is willing to expand its ties with Iran via technology transfer due to the implementation of the JCPOA [the formal name of Iran’s nuclear deal with world powers]," Nordrum noted, adding that Caspian Sea offshore structures let his country extend its cooperation with Iran's neighboring states in the northern region.

Iran's oil and gas developments are mostly concentrated in the south where it shares the giant South Pars Gas Field with Qatar in the Persian Gulf and several oilfields with Iraq.

Zamaninia also expressed hope that KEPCO's cooperation with ORG can pave the way to expand surveys in the Caspian Sea oil and gas fields.

"Concluding such deals indicates that international firms have faith in Iran," the official said, noting that Norwegian enterprises can play a major role in developing Iran's massive hydrocarbon reserves.

Long-Term Ventures

According to Manouchehri, Norwegian firms have access to the most cutting-edge know-how in exploration and deep sea drilling operations and the MoU can help the two sides embark on long-term ventures.

Referring to the NIOC's database on the southern part of the Caspian Sea, he noted that ORG's studies can help NIOC to update and revise its key information about the region.

"Deepwater drilling and exploration require state-of-the-art technology, but Iranian companies lack the experience in this area," Manouchehri added, expressing hope that the preliminary agreement facilitates the process of technology transfer to the country.

Asked about a recently clinched agreement between Russia's Lukoil and KEPCO in Moscow, Delaviz noted that such deals can definitely help Iran tap into its fossil fuels in the north, where the country has produced zero barrels and no amount of gas despite sitting on the world’s fourth-biggest crude and second biggest natural gas reserves.

Officials say these agreements, signed after several months of negotiations, can unlock Iran’s massive hydrocarbon reserves in one of the world’s biggest offshore oil and gas regions.

Sardar-e-Jangal field contains an estimated 1.4 trillion cubic meters of natural gas in-place and some 500 million barrels of recoverable crude.

The Caspian region is one of the oldest oil-producing areas in the world and is an increasingly important source of global energy production. It holds an estimated 48 billion barrels of oil and more than 8 trillion cubic meters of natural gas in proven and probable reserves

Founded in 1999, ORG is provider of technologies and solutions with proven results from 17 years of operations. ORG’s strategy is to invent and develop technologies that offer substantial costs savings and risk reducing elements defined as “mission critical” by the oil companies.

Norwegian firms are expanding their foothold in Iran's lucrative and untapped energy market gradually.

Norway’s Saga Energy signed a €2.5 billion ($2.94 billion) contract in Tehran last week to build solar power plants in Iran, a flurry of deals by foreign companies since the easing of international sanctions on the country in 2016 after it agreed to limits on its disputed nuclear program. 

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