Domestically-manufactured electric submersible pumps in Petro Faraz Avar Sahel Tadbir Company will help raise crude output in Iran’s 22 oilfields by at least 700,000 barrels per day.
Yaser Fallahzadeh, the head of the privately-run PFAST Company, made the statement in a ceremony to inaugurate Iran’s first pump manufacturing factory in Ahvaz, Khuzestan Province, on Tuesday, IRNA reported.
Costing $15 million, the venture was funded by Persia Oil and Gas Company and an unnamed Russian partner, he added.
Fallahzadeh noted that the plant has the capacity to produce 150 pumps annually, making Iran self-sufficient in producing the device in the key oil industry.
“Importing the equipment costs the National Iranian Oil Company $12 million per year,” he added.
Reduction in oil reservoirs’ pressure decreases extraction capacity by 7% per year, because of which NIOC has prioritized a rise in recovery factor.
With the help of local electric submersible pumps, not only can NIOC benefit from secondary recovery methods or improved oil recovery (IOR) techniques, but will also be able to apply tertiary recovery methods or enhanced oil recovery.
According to the official, plans are in place to install ESPs in more than 1,300 oil wells across the nation, in which case NIOC’s daily output will rise by 700,000 barrels per day.
The industrial unit has created more than 1,000 direct jobs in the region.
Electric submersible pumps are probably best known as an effective artificial lift method of pumping production fluids to the surface. ESPs are especially effective in wells with low bottomhole pressure, low gas/oil ratio, low bubblepoint, high water cut or low API gravity fluids.
Over the last several years, ESP technology has developed a reputation as a low-maintenance, cost-effective alternative to vertical turbine, split case and positive displacement pumps in various fluid-movement surface applications in the petroleum industry.
Recovery Rate
Iran is sitting on an estimated 800 billion barrels of oil and condensates in place, of which only 239 billion barrels are recoverable at the current recovery rate of 25%, Ramin Hatami, the former managing director of Central Iranian Oil Fields Company, said.
In other words, if the recovery factor reaches 26%, the National Iranian Oil Company will be able to add 800 million barrels to its present production capacity, he added.
Recovery factor is the ratio of technically and economically recoverable reserves to the total amount of oil in a reservoir.
Iran has 358 oil and gas reservoirs, including 195 undeveloped fields.
"We need to implement enhanced recovery techniques to raise output from more than 70% of our reservoirs," he added.
According to NIOC data, Iran’s in-place oil in the Persian Gulf amounts to 100 billion barrels, some 16 billion barrels of which are recoverable.
“NIOC has boosted its crude oil refining capacity to 3.8 million barrels per day, returning to levels not seen before the US withdrawal from the nuclear deal and reimposition of sanctions on Iran's crude sales in 2018,” Mohsen Khojastehmehr, managing director of the state-run NIOC, said.
"The plan to raise oil production capacity was implemented in less than six months at an estimated cost of $500 million."
The money was mainly spent on digging new wells and installing electric submersible pumps in marginal and abandoned wells whose output level had decreased substantially, he added.
According to the official, the current capacity cannot grow unless knowledge-based firms join hands with NIOC.
Indigenized Equipment
The NIOC chief said not only can they indigenize much-needed equipment, including turbines, compressors and pipes, but they can also help improve the recovery and revival of oilfields and clean up abandoned oil wells.
Referring to contracts with domestic companies, Khojastehmehr said agreements worth $270 million were concluded with the Academic Center for Education, Culture and Research, a subsidiary of the non-government Supreme Council of Cultural Revolution, based on which the research center was tasked to provide NIOC with high-tech equipment and materials.
Oil and condensate exports have increased in recent months, he said, without elaborating.
"We welcome foreign investment regardless of the sanctions and without any preconditions," he said, adding that Iran has already started talks to develop oil and gas fields in cooperation with foreign companies.
Iran is discussing ventures with Chinese companies, including Sinopec and CNPC that had already been involved in the development of Iran's oilfields shared with Iraq.
China is Iran's largest oil customer and Khojastehmehr said Iran is seeking new buyers.
"We intend to identify new markets that should be stable and secure to continue our oil sales. We should be able to attract strategic customers. We are ready to sign even long-term contracts for the sale of crude oil, gas condensates, gas and oil products," he said.
Khojastehmehr said South America is one of NIOC's markets.
"We seek to attract strategic customers ... Venezuela is one of these countries," he added.
He noted that Iran has decided to remodel the Iran Petroleum Contract, which is a 2016 pact devised by the previous Iranian government.
"Our plan is to improve IPC to make it more attractive and remove its deficiencies," he said.
