The Indian contractor of Farzad-B Gas Field, which is purported to be ONGC Videsh Ltd., has until September to submit a financial proposal for the development of the sought-after energy project, managing director of Pars Oil and Gas Company said.
Ali Akbar Shabanpour added that the state-owned National Iranian Oil Company has yet to reach a decision about the development rights of the gas field in the Persian Gulf, ISNA reported.
The official ruled out any serious disagreement with India over Farzad-B that was discovered by Indians eight years ago, but stressed that their cooperation in developing the field should be renegotiated as the previous contract and the feasibility studies of the field’s development were based on higher oil prices.
“But with the fall in oil prices, the Indian company should again study the viability of the project and offer a new financial plan, which will ultimately be approved by the Oil Ministry,” he added.
According to Shabanpour, if the contractor of the field would fail to propose its financial model until September, the Oil Ministry will decide whether to extend the current contract with the Indian company.
He also commented on the issue of parts purchased before the imposition of sanctions for the development of South Pars phases but were blocked, saying Iran has received some of the parts after the lifting of sanctions in January, and some others are in the process of entering the country.
The official noted that these equipment are applicable in major development plans and other regular projects.
Past Developments
A consortium of OVL, Oil India and Indian Oil Corp. had discovered an estimated 363 million cubic meters of gas reserves in the Farsi Block in 2008. The discovery was later named Farzad-B.
However, the consortium could not obtain the permission to develop the field due to western sanctions against Iran’s nuclear program.
Saeed Hafezi, managing director of the Iranian Offshore Oil Company, told Mehr News Agency in December that the consortium has reached an initial agreement with Iranian officials to develop Farzad-B Gas Field under a $3 billion contract.
Earlier in September, The Wall Street Journal reported that OVL, the overseas arm of India's state-owned Oil and Natural Gas Corp., had submitted a $10-billion proposal to Iran for developing Farzad-B and shipping its gas to India.
Oil Minister Bijan Namdar Zanganeh described Farzad-B last year as the only Iranian project "promised" to a foreign contractor.
As a further sign of interest in working with Indians in Farzad-B project, Iran did not list the gas field among the 52 oil and natural gas projects introduced to international companies in a major conference in Tehran in 2015.
Seyyed Mehdi Hosseini, the head of Iran's Petroleum Contracts Committee, told Reuters in April that bidding and negotiations for Iran's oil and gas fields will start in June or July.
