Iran's oil minister said development projects in shared oil and gas fields top the National Iranian Oil Company's list of priorities.
Bijan Namdar Zanganeh, who was interviewed on national TV late Tuesday, stressed that West Karoun oil output will reach 200,000 barrels per day in eight months, Shana reported.
"Long-term plans have been made to raise production up to 700,000 bpd from West Karoun Oilfields, including Yadavaran and Azadegan, which straddle Iran and Iraq."
Although Zanganeh did not elaborate, the jump could be the most rapid production increase in the Iranian oil industry's history.
Referring to "Resistance Economy" in the Oil Ministry's plans to increase oil extraction from joint fields, the oil minister noted that even during the sanctions period, not only did production from joint fields not decline, but it also experienced a gradual rise.
"Resistance Economy" is a set of policies aimed at promoting economic self-reliance and weaning the country off heavy dependence on oil revenues.
"Iran has 145 hydrocarbon fields, 23 of which are shared with neighbors, including Kuwait, Iraq, Qatar, Bahrain, the UAE, Saudi Arabia and Turkmenistan," he said.
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 by nearly 60% to 110,000 barrels per day in the past four years.
Asked about oil and gas industry's downstream sectors, Zanganeh said, "Petrochemical industry is among the key downstream sectors, which must be fully developed to generate high value-added products."
Downstream operations include refineries and marketing. These services turn crude oil into usable products such as gasoline, fuel oils and petroleum-based products.
"Our new petrochemical feedstock sources are either gas or gas condensates," he added, noting that concurrent with the South Pars Gas Field's development projects, which started in the 1990s, petrochemical industry started to witness dramatic changes.
Iran's petrochemical production by March 2015 will be worth $22 billion, up from $1 billion in 1997.
“The 22-fold growth is a huge step forward. The value of our petrochemical products is expected to exceed $40 billion by the end of the sixth five-year development plan (2016-21),” he said.
Commenting on the announcement of long-awaited feedstock prices, the oil minister said now that all ambiguities are resolved, investors in the petrochemical industry can embark on projects without having to deal with the global price fluctuations of petrochemicals.
Needless to say, Iran has a comparative advantage in terms of abundance and price of feedstock.
The new prices, ranging between 8.5 and 9 cents per cubic meter, were formulated based on an integrated formula taking into account domestic and international gas prices. They will take effect from March 20, 2016, and will not change till 2026.
Zanganeh believes that a substantial investment, basically by the private sector, is required so that a complete chain of petrochemical products is created.
"Plans have been made to increase crude refining capacity, including gas condensates, from the current 1.8 million barrels a day to 3 million bpd by 2023," the official said, noting that gas condensate production from the South Pars is expected to exceed 1 million bpd by 2018.
"When Phase 22 of South Pars comes on stream, the country's gas supply and demand will be at equilibrium," he said.
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.
