Production Resumes at Iran-BP gas Field

Production Resumes  at Iran-BP gas FieldProduction Resumes  at Iran-BP gas Field

BP will restart the Rhum gas field in the UK North Sea, half-owned by Iran's National Oil Company, four years after the field was shut down due to Western sanctions, a BP spokesman said on Friday, Reuters reported.

Production from the field, which supplied 4 percent to 5 percent of Britain's demand before its shutdown, is expected to begin by Sunday.

BP received approval from the British government to resume production after the government put the field under a temporary management scheme whereby all revenue due to Tehran will be held by the British government in a frozen account until a full resolution over sanctions emerges.

The British government gave the green light for the resumption late last year in order to avoid damage to the high pressure, high temperature gas field.

BP said it would take two to three days for gas flows from the field to feed though Rhum’s platform systems to allow for eventual delivery.

The oil company is expecting initial output at Rhum to be held at 50m cubic feet per day. The field’s peak output capacity had initially been expected to reach 300m cubic feet per day.

UK’s Department of Energy and Climate Change said: “The government supports the resumption of production at Rhum, which is necessary to avoid potential environmental damage and will prevent the possible destruction of the value of the field and its important contribution to the UK’s annual gas production.”

 “A successful restart of Rhum will provide an important source of domestic gas and tax revenue for the UK and also extends the economic life of the Bruce field and facilities, thereby securing some 600 jobs and deferring decommissioning,” Trevor Garlick, regional president for BP North Sea, said last year when initial talks on reopening of the field began by the UK government.

The closure of the field was followed by a sharp decline in UK gas production, which fell from 55bn to 37bn cubic meters between 2010 and 2012. That compares with peak output of at 108bn cu m in 2000.