Tehran is ready to expand cooperation with Russian firms in the fields of oil and natural gas, as energy contracts are expected to be signed soon.
Iran’s Oil Minister Javad Owji made the statement in his meeting with Russia’s Deputy Prime Minister Alexander Novak in Moscow late Tuesday, ILNA reported.
"We explored ways of collaborating with Russian companies and important decisions were made, which can positively affect energy markets in the region," Owji said, noting that talks were held about developing oil and gas fields in Iran, investing in liquefied natural gas projects and transferring knowledge to petrochemical sector.
Underlying the two countries’ potentials in the key energy sector, the minister expressed hope that long- and short-term agreements would be concluded in the near future.
According to the Iranian oil minister, negotiations held with Russian oil and gas giants focused on providing Iran with modern equipment, machinery and technical know-how.
“Iran has finished drafting the details of a comprehensive cooperation document with Russia and it has been submitted to Moscow,” he said.
Iran’s private and state-run firms, which do not cooperate with American corporations in the field of producing and exporting LNG, are ready to collaborate with Russian companies.
“We have put forward detailed proposals regarding the LNG sector and we are sure collaboration in this industry can affect regional markets positively,” Owji said.
Drawing on the experience of Russian oil and gas giants is crucial to transform Iran into a major player in the global gas market.
“Using the expertise of Russian gas giant Gazprom and Russia's No. 2 oil producer Lukoil will enable NIOC to access advanced technology for extracting gas from deep geological repositories to produce and export LNG,” he said.
According to the oil minister, Iran has the infrastructure for increasing gas import and swap deals with neighboring countries up to 40 million cubic meters per day, or 15 billion cubic meters per year.
“We started transferring 5 mcm of natural gas per day [2 bcm per year] of Turkmenistan, located to the east of Caspian Sea, to Azerbaijan, on the western side of the sea, based on a trilateral agreement reached last November and the National Iranian Oil Company is ready to sign similar contracts with Russia,” he said.
Iran holds the world’s second biggest natural gas reserves after Russia and the fourth-largest known oil reserves. It is home to 17% of the world's proven natural gas reserves and more than one-third of OPEC reserves.
OPEC+ Policies
The two sides also share the same stance regarding OPEC+ policies to boost output to balance the market amid forecasts of softening demand in the first quarter of 2022.
Despite the low inventories and US pressure to pump more oil, OPEC+ ministers agreed last November to hike output as planned by 400,000 bpd in December, citing concerns about Covid-19 infections and demand recovery.
OPEC+ stood firm on boosting crude output quotas by last December increment, despite prices holding on close to three-year highs.
The December hike is in line with the last July agreement to boost output by 400,000 bpd per month starting August, an increment that added a total of 2 million barrels per day by the end of 2021.
Russia, as a global power in Iran’s neighborhood, has an important place in Iran’s foreign policy.
This country has shared views and interests with Iran in many regional and international issues, and the two countries have an enormous potential for mutual cooperation in all sectors, including politics, economy, trade, defense and technology.
The leaders and top authorities of both countries support efforts to strengthen and expand ties in many fields.
The volume of trade between Iran and Russia currently stands at $2 billion, of which $700 million pertain to Iran’s exports.
