Crude Oil, Gas Condensates Exports at 1.75 Million bpd

Crude Oil, Gas Condensates Exports at 1.75 Million bpdCrude Oil, Gas Condensates Exports at 1.75 Million bpd

Oil Minister Bijan Namdar Zanganeh said Iran's combined oil and gas condensates exports reached 1.75 million barrels per day in February and hoped that crude supply to South Korea will more than double from around 100,000 bpd.

Zanganeh made the remarks after meeting Joo Hyung-hwan, South Korea's minister of trade, industry and energy, in Tehran on Monday.

"Exports of crude oil and gas condensates in February increased by 400,000 bpd compared with the same month of last year," Zanganeh was quoted as saying by Mehr News Agency.

The rise comes after the US and the EU revoked some sanctions against Iran in January, paving the way for Tehran to conduct business with its crude customers without fear of violating trade and financial embargos.

According to the Oil Ministry, Iran has already implemented plans to raise crude production capacity by 500,000 bpd after the lifting of sanctions in January.

Iran was the second-biggest producer of the Organization of Petroleum Exporting Countries in 2011 after Saudi Arabia, but was relegated to fifth place after financial and trade embargos cut its crude exports to little more than 1 million bpd from around 2.6 million bpd.

"Korean officials have promised to increase crude oil and gas condensates imports from Iran to more than pre-sanctions levels and increase their intake in 2016," Zanganeh said. "Iran sees South Korea as an important Asian partner and a reliable customer for oil and liquefied natural gas."

South Korea, Japan, China, India and Turkey are traditional customers of Iran's crude oil. Customs data show South Korea's imports of Iranian crude tripled in January from a year earlier, although shipments remain far below pre-sanctions levels.

In a report contradictory to figures provided by Zanganeh, Reuters said South Korea's January imports of Iranian crude more than tripled versus a year ago to about 209,000 bpd, the most since February 2014.

The combined imports of South Korean refiners in 2011 reached 87.18 million barrels worth $9.2 billion, but tumbled to 44.92 million barrels worth $4.5 billion in 2014.

------- Korean Finance and Investment

The two sides also discussed the cooperation and investment of Korean companies in the Persian Gulf country's multibillion-dollar energy projects.

South Korea was active in Iran's energy sector, but sanctions forced Korean companies to halt operations in Iran after the US and the EU introduced tighter curbs against the country's nuclear program in 2012.

Korean majors started negotiations to return to Iran after the country reached an agreement with six world powers on its nuclear program, which was followed last months by the lifting of some decades-old sanctions.

Zanganeh called on South Korean contractors to resume operations in Iran and called for Korean investment and finance to develop Iran's energy projects.

"We propose Koreans invest in LNG, petrochemical, refining and distribution," Iran's top oil official said.

South Korea's state-run electricity giant Electric Power Corporation and conglomerate Hyundai Group, among others, have discussed joint ventures over the past few months.

On Sunday, Iran's Economy Minister Ali Tayyebnia welcomed Korean investment in oil and gas sector and said Korea Trade Insurance Corporation (K-Sure) would provide up to €5 billion in finance for Iranian projects.

The company said in a statement this month it is planning to provide more than $118 billion worth of trade insurance this year to new markets such as Iran and Cuba.

In related news, Iran sold a light hydrocarbon liquid pumped from South Pars Gas Field to South Korea’s Hanwha Total Petrochemicals Ltd, according to Bloomberg.

The National Iranian Oil Company will load in April a cargo of condensate to be shipped to the South Korean petrochemical maker, Bloomberg cited an NIOC official as saying.

That will be the first shipment of supply from the offshore South Pars natural gas fields to the Asian company, which had been purchasing Qatar’s competing deodorized field condensate while sanctions were in place on the Persian Gulf state.