Post-Sanctions Energy Policies Outlined

Post-Sanctions Energy Policies OutlinedPost-Sanctions Energy Policies Outlined

Iran will turn into a key player in the global oil market in the near future, the acting oil minister said while outlining energy policies in Iran's post-sanctions period.

Seyyed Kazem Vaziri-Hamaneh made the statement on the sidelines of the 12th International Energy Exhibition (Kish ENEX 2016) that opened in Kish on Monday, Mehr News Agency reported.

Vaziri-Hamaneh noted that Iran's huge oil and gas reserves can help prepare the ground for undertaking international transactions and consolidate the country's position in the global energy market, in addition to meeting domestic demand.

Tens of foreign companies have participated in the four-day energy event, which is the first after Iran and the West reached the historic nuclear deal in July to lift sanctions against the country in lieu of curbs on its nuclear program.

The official expressed optimism that with the removal of sanctions, oil and gas production capacity will increase and generate productive and sustainable wealth which, in turn, will accelerate the country's economic growth.

"While exploiting hydrocarbon resources, special attention should be paid to issues like spatial planning, domestic demand for oil, oil byproducts and gas, and environmental considerations," he said. Vaziri-Hamaneh underscored the need to change the outlook on oil and gas revenues in the sixth five-year economic development plan (2016-21).

The official said oil revenues must be spent on development projects, instead of meeting the general budget expenditures, hence the establishment of a value chain in the energy sector seems vital.

"In line with the 'Resistance Economy' policies, the oil industry has prioritized joint fields' development projects since March 2014," he said. Resistance Economy refers to a set of guidelines proposed by the Leader of Islamic Revolution Ayatollah Seyyed Ali Khamenei to counter sanctions, promote domestic growth and reduce reliance on oil revenues.

"To take the economy out of recession and support domestic production, plans call for the indigenization of 10 highly-consumed commodities in Iran's oil industry," he said.

"Moreover, a roadmap on implementing Resistance Economy policies has been devised by the Oil Ministry and the Economy Council has approved it."

Vaziri-Hamaneh noted that the supply of 95% of the country's energy demand by the oil industry is the most significant advantage of the key sector.

According to the official, promoting Iran's energy diplomacy and enhancing national security by increasing international and regional transactions and increasing the gross domestic product top oil industry's list of priorities in the post-sanctions period.  Head of Atomic Energy Organization of Iran, Ali Akbar Salehi, in a message to Kish ENEX 2016 said, “Because of having huge hydrocarbon reserves and enjoying a history of over a hundred years in the energy sector, Iran has always been considered one of the leading countries in the world in the field of energy."

Salehi called for a strategic vision in the development of the country’s long-term plans for the energy sector that would be both comprehensive and multi-sectoral.

Head of the Society of Iranian Petroleum Industries Equipment Manufacturers, Reza Padidar, announced that about 70% of Iranian oil industry manufacturers' potentials have remained unutilized. Padidar said Kish must turn into an investment and technology hub in the energy sector after the lifting of sanctions.

He noted that once sanctions are terminated, management of development, production, exploitation and equipment should be on the country's agenda.

Padidar also said that at present about 65-70% of Iranian industries can contribute to the oil industry. He called for establishing a center for oil technology transfer in Kish Free Zone.