Oil Reserves on the Skids

Oil Reserves  on the SkidsOil Reserves  on the Skids

Taking into account the maturity of Iran's oilfields as well as the current rate of extraction from the reservoirs, oil production is expected to dwindle to less than one million barrels per day by 2025, Moj news agency quoted deputy oil minister as saying.

Over the past years, considerable emphasis has been put on optimized production (increasing life span of oil and gas reserves through utilizing production improvement measures), Emad Hosseini said adding: "Much needs to be done to preserve the oil reserves."

The original oil in place (OOIP) is currently around 650 billion barrels, of which 156 billion barrels are recoverable, while 494 billion barrels are not. "We need to revise the figures by utilizing the latest technologies," Hosseini stated.

The decline in oil production over the past years is not only provoked by the sanctions imposed on the energy industry, but it's also rooted in the authorities' heedlessness regarding protective production.

Iran's oil reservoirs had faced very low pressure, and production from several fields has diminished from 400,000 barrel per day (bpd) to only 60,000 bpd. "In a few years, this will drop to the point when there would be no oil to extract."

Referring to the negligible expenditure on development of the oil and gas industry, Hosseini said while in major international companies the figure stands at 30 percent or more it is less than one percent in Iran. Iran's oil extraction rate (OER) also stands at 25 percent, which is a lot less than global average.

The US and its allies imposed tough sanctions on Iran to curb the country's nuclear program which they claim is geared to military use. Iran insists its program is aimed solely at civilian purposes. Iran and the P5+1 group ( five permanent members of the UN Security Council, namely United States, Russia, China, United Kingdom, and France, plus Germany) have been holding marathon talks over the past year to thrash out a mutually acceptable deal.

Iran holds the world’s second biggest natural gas reserves after Russia, and the fourth-largest proved crude oil reserves.  However, the vast majority of reserves have matured, as a result of which production has become less economically viable.