Iran's oil minister said the National Iranian Oil Company needs $50 billion to carry out its development projects in shared oil and gas fields.
Bijan Namdar Zanganeh, who was interviewed on national TV late Wednesday, reported on the ministry's current and past performance and outlined future plans. Iran has 145 hydrocarbon fields, 23 of which are shared with neighbors, including Kuwait, Iraq, Qatar, Bahrain, the UAE, Saudi Arabia and Turkmenistan.
"The government's main concern is extracting from shared oil and gas fields," Zanganeh said.
Oil West of Karoun
Two of NIOC's most recent oil discoveries, Yadavaran and Azadegan fields with combined reserves exceeding 50 billion barrels of crude—nearly one-third of Iran's total reserves and more than Libya's total oil reserves—are bordering Iraq. The field's combined production capacity has increased nearly 60% to 110,000 barrels per day in the past four years. The NIOC is aiming for a 260,000 bpd within a year's time.
The Oil Ministry plans to boost the two fields' production capacity to 700,000 bpd in what could be the "most rapid production [increase] in the Iranian oil industry's history."
Zanganeh's expansion plan for the two fields, both west of Karoun River, needs an investment of $20 billion.
Gas in South Pars
Expanding production in South Pars natural gas condensate field in the Persian Gulf is another priority for Zanganeh.
Getting all of the field's 30 phases running—16 of which are already operational—needs $30 billion, according to the minister. The plan would raise Iran's gas production capacity to 1 billion cubic feet per day. South Pars is capable of producing about 25 billion cubic feet (710 million cubic meters) of natural gas per day.
"When Phase 22 of South Pars comes on stream, the country's gas supply and demand will be at equilibrium," said the minister.
South Pars is the world's largest gas field, shared between Iran and Qatar, estimated to hold 1,800 trillion cubic feet (51 trillion cubic meters) of in-situ natural gas and some 50 billion barrels of natural gas condensates. About 1,260 trillion cubic feet of the field's total gas reserves are recoverable, constituting about 19% of world recoverable gas reserves.
Iran will offer projects to extract oil from its South Pars Gas Field, along with three other gas fields at a conference in London later this year.
Gas Distribution
"With the efforts of my colleagues, over 70 million people, 77% of Iranians, have access to heating gas. Based on our planning, eight million people will join the gas network within two years," Zanganeh said.
The focus of this grid expansion will be villages. 28,000 villages will be added to the 17,000 villages that have access to gas in the next three years, according to Hamidreza Araqi, chief executive of the National Iranian Gas Company. The project needs 60 trillion rials ($1.8 billion at the official exchange rate) most of which will come from savings from cutting gas consumption. Some of this network expansion and management will be handled by private companies.
Ramping Up Crude Production
Iran will ramp up crude oil production and reclaim its lost share of exports shortly after international sanctions on the OPEC member are lifted, Zanganeh said.
Iran and six world powers agreed a deal in July to curb Tehran's nuclear program in exchange for lifting sanctions against it.
"After lifting sanctions, Iran will double its crude exports," he said. "This will amplify Iran's dependence on oil revenues but will also boost economic growth."
Iranian oilfields, which pumped around 2.87 million bpd in July, could increase production to between 3.4 million and 3.6 million bpd within months of sanctions being lifted, the West's energy watchdog, International Energy Agency, said.
The report by the Paris-based IEA suggested any increase in output would probably be more modest than Iranian estimates and said Tehran would need massive investment to raise production capacity.
