$7b for Development of Lavan Oil, Gas Fields

$7b for Development of Lavan Oil, Gas Fields$7b for Development of Lavan Oil, Gas Fields

The integrated development plan for Lavan region's gas fields was ratified by the National Iranian Oil Company (NIOC)'s board of directors, stipulating provision of $7 billion investment through the authorization laid down by Note 2(G) of the budget law, said the managing director of the Iranian Offshore Oil Company (IOOC), Shana news agency reported.

Note 2(G) establishes the investment framework for the oil ministry, allowing it to invest up to $100 billion in oil and gas projects through conclusion of contracts with private firms, in line with Article 44 of the Constitution – to help open new opportunities to the private sector and boost privatization.

The funds are for the development of Resalat and Reshadat oilfields, as well as Salman oil and gas field. "Fund allocation procedure is to be conducted at an accelerated pace," Saeed Hafezi noted.

Development of Salman gas field's second phase (Kangan/Dalan layer), and construction of pipelines to transfer gas from Salman field to Siri Island in order to enhance the joint field's gas production capacity are among the project's main undertakings.

Lavan Island is situated 18 kilometers south of the Persian Gulf coast. Oil exploration in this area commenced upon activities of LAPCO (Lavan Petroleum Co.) and the first oil production from Salman reached Lavan Island in 1967. The region in total produces 105,000 barrels of oil per day. Lavan has a two-berth jetty, which can accommodate vessels up to 250,000 deadweight tons. Lavan region's storage capacity is 5.5 million barrels.

Salman field has one of the largest offshore installations in the Persian Gulf and it is jointly owned with ABK of Abu Dhabi. The field has nearly 50 oil wells and 10 water injectors. The field's capacity stands at 220,000 oil barrels, which is transferred to Lavan Island by a 22-inch offshore pipeline.

Resalat field is located 93 kilometers south of Lavan Island. It has 14 wells. It was badly damaged after it came under Iraq's bombardment during the Iraq-Iran War (1980-88). There are plans to reconstruct the field, and bring it back to full production.

Reshadat field is located about 110 kilometers southwest of Lavan Island. Likewise, it was attacked frequently by Iraqi forces during the 1980-88 Iraq-Iran war. The oil from Reshadat and Resalat fields together is transferred to Lavan through an 18-inch pipeline.

Kharg, Lavan, and Siri islands, in the Persian Gulf, handle the lion's share of Iran's crude oil exports. There are also two small crude oil terminals at Cyrus and Bahregansar, one terminal along the Caspian Sea, and other terminals that handle exports and imports of mostly refined products.