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Siemens, Oil Ministry Discuss Joint Venture

Siemens, Oil Ministry Discuss Joint VentureSiemens, Oil Ministry Discuss Joint Venture

Oil Minister Bijan Namdar Zanganeh said Iran can turn into a regional hub for the production and export of oil and gas equipment in cooperation with German conglomerate Siemens.

He made the statement after meeting president and chief executive officer of Siemens, Joe Kaeser, in Tehran Monday, Shana reported.

"A new chapter of cooperation has commenced with Siemens and joint ventures will be launched sooner or later," Zanganeh said.

He added that war-torn Iraq as well as Kazakhstan and Turkmenistan in Central Asia will be the main target of Iran-Siemens production linkage.

"Oil Ministry and Siemens had an effective collaboration in manufacturing a large number of gas turbo-compressors in the past in Iran. We need to promote such cooperation as Siemens' gas turbines and compressors offer long-term efficiency, availability and reliability," Shana reported.

The oil minister also pointed to around 30 turbines and compressors Iran had bought to upgrade its aging oil and gas facilities but were blocked by Siemens due to international restrictions in doing business with the Persian Gulf country.

Zanganeh said the equipment were to be used not only in South Pars Gas Field facilities but also in Iran LNG and Persian Gulf Star refineries, and added that Iran has become a key producer of gas turbo-compressors in the region.

Moreover, plans have been devised to promote the domestic companies' long-term cooperation with the German company for manufacturing state-of-the-art oil and gas equipment that fulfill industry-specific customer requirements in the oil and gas segment, onshore gas production, or gas transport through pipelines as well as in industrial applications.

Siemens managers have pledged to ship and install the seized high-tech turbines and compressors as soon as possible. It is also planning to expand collaboration with Iranian firms, including Oil Turbo Compressor Company, which manufactures gas compressors, turbo generators and gas turbines.  

Stressing that Iran requires a wide range of rotary machinery and gas compressors to double its gas extract, Zanganeh said, "Siemens can be a perfect business partner for Iran. Needless to say, it is a key supplier of oil and gas cutting-edge equipment, which explains why their investment in Iran's energy sector will definitely yield positive results, create lots of jobs and lead to our country's economic prosperity."   

"We want to pick up where we left off," Kaeser said in a statement, citing its engagement in Iran since 1868, especially in the energy and rail transportation sectors. "We see great pent-up demand."

Kaeser noted that Iran and Germany are willing to expand ties in petrochemical, refining and distribution, fuel consumption efficiency and oil equipment production sectors.

"We never left the country and stand by our commitment also in difficult times, always compliant with international regulations. We'll now be stepping up our efforts toward continuing this long tradition," Kaeser said.

------- Blocked Equipment

According to Amirhossein Zamaninia, deputy oil minister for international affairs, Iran and Germany have already discussed ways of releasing Iran's oil equipment that were blocked by sanctions.

Siegfried Russwurm, Siemens' chief technology officer, also told Shana that "there are no legal restrictions anymore" to supply Iran with oil equipment following the lifting of sanctions.

Russwurm added that Siemens is closely monitoring investment opportunities in Iran's oil, gas, railroad and transportation sectors.

The US and the European Union officially ended decades-old sanctions against Iran on Jan. 16, six months after Iran and the six world powers (the five permanent members of the United Nations Security Council plus Germany) reached an agreement on placing time-bound sanctions on Iran's nuclear program in exchange for some sanctions relief.

Iran has also launched negotiations with another German company named MAN on renovating power plant installations of Iran’s oil industry in the Persian Gulf.

The engineering company MAN was one of the top 30 companies listed on the German stock exchange until September 2012. The company operates through fully-owned subsidiaries or joint ventures with local companies in India, Poland, Turkey, China, the United States, the UAE, South Africa, Uzbekistan, Portugal and Austria.

Financialtribune.com