LNG Export to Europe Viable

LNG Export to Europe ViableLNG Export to Europe Viable

There may be an increase in Iranian gas production to 11 million cubic meters a day by 2017 and the country hopes Europe could become one of its key markets.

“The EU always consumed Iranian oil. Europe may become a market for Iranian gas in the mid- and long-term. Iran may start liquefied natural gas supplies to Europe in 5-10 years,” Iran's Deputy Oil Minister Amir Hossein Zamaninia said, addressing a conference in Vienna on "EU and Iran Business and Investments", TASS reported.

Should the country start producing enough gas for export, the destination will be determined by the economic viability, said Zamaninia. Liquefied natural gas supplies are a more preferable option for Europe than pipelines. Iran could start LNG supplies to Europe in 5-10 years, he added. As for pipeline gas supplies, the country is more interested in the Asian market as the price there is much higher than in Europe. Sanctions against Iran’s oil and gas sectors may be lifted in late October or early November according to the official. Tehran must adhere to the nuclear deal reached in Vienna this month to see sanctions lifted.

“It can happen in late October-early November. This is my assessment about the implementation day if everything goes smoothly in Iran’s Majlis and US Congress,” Zamaninia told journalists Thursday.

The country’s crude reserves, estimated at 30 billion barrels, are some of the largest in the world. In the short-term, Iran’s exports are expected to rise by around 200,000 barrels per day.

Tehran aims to win back its 42-43%t share of the European market after western sanctions are lifted. Last week, Iran’s Oil Ministry said it has already signed a package of contracts to deliver oil in 2015 and that the country is due to increase oil extraction to a pre-sanctions level of 4 million barrels per day.