A project to drill oil in the Moghan Plain, Ardabil Province, will start by July, the project manager said.
“An onshore drilling rig owned by the National Iranian Drilling Company is on the way from Ahvaz in the southwest to Ardabil 1,300 km in the northwest and drilling will begin in the next six weeks,” Mehr News Agency quoted Ali Rafiei as saying.
The National Iranian Oil Company has been carrying out exploration in Moghan in the past decade. The oilfield is important as it can supply crude oil to Tabriz Refinery in the neighboring? East Azerbaijan Province.
Oil is supplied to Tabriz Refinery from the southern regions. If the Moghan project is a success oil will be sent to Tabriz Refinery putting an end to oil transfers from the south to the northwest.
The Moghan oilfield is near the border with the Azeri Republic and is estimated to contain over four billion barrels of mostly light crude.
Iran is developing its sprawling oil industry despite declining exports due to the US sanctions since in 2018. Oil production increased by 400,000 barrels per day last month compared to April 2020, OPEC’s latest monthly report for May indicates.
Although the US sanctions on oil export and banking are in place, it is reported that Iran is selling bigger quantities since September 2020. Last April Iran produced just under 2 million bpd but this year production is around 2.4 million barrels.
In addition to the devastation caused by the coronavirus pandemic on the global oil industry that hammered oil prices, Iran’s oil industry has been under added pressure from the US economic blockade in the past three years, which has targeted crude oil export and the banking, shipping and insurance industries.
Iran has been under tough US restrictions since 2018, when Donald Trump, the beleaguered former US president, unilaterally withdrew from the Iran nuclear agreement.
The Biden administration is indirectly negotiating with Iran in Vienna to revive the 2015 nuclear deal, which would mean the US lift at least part of the unilateral sanctions.
Indigenizing Parts
Indigenizing drilling parts and equipment is underway at the National Iranian Drilling Company, head of the NIDC Technology and Engineering Department said.
“Manufacturing 60 parts is on the NIDC agenda,” Behnoud Mansournejad said.
"Thanks to collaboration between the NIDC and other organizations and manufacturers, more than 7,000 parts have been indigenized,” he said, adding that the parts account for almost 80% of the industry's needs.
The indigenized equipment includes drilling mud pumps, blowout preventers, traction motors, draw-works, drilling fluid recycling systems, mission centrifugal pumps, top drives, and drilling rig slow circulation rate pressure systems.
A large number of drilling machinery cannot be imported due to the US sanctions, which should be a "blessing in disguise" to convince domestic firms to enhance quality, an issue that has long been the subject of criticism because the companies have lagged behind international standards.
The NIDC, a subsidiary of the National Iranian Oil Company, accounts for 65% of the domestic drilling market share. It undertakes most drilling work in the country and has drilled 4,500 onshore and offshore oil and gas wells in four decades.
The company plays a key role in drilling exploratory and development wells in Azadegan Oilfield in Khuzestan near the Iraqi border and in South Pars, the world's largest gas field shared by Iran and Qatar in the Persian Gulf, as well as several other fields including Yaran, Yadavaran and Darkhoin oil fields in Khuzestan, and the Azar oil field in Ilam Province.
