1800km Pipeline Will Carry Iran Gas to Europe

1800km Pipeline Will Carry Iran Gas to Europe
1800km Pipeline Will Carry Iran Gas to Europe

By launching the 9th pipeline of national gas network, which requires an estimated $8.5 billion investment, Iran is creating the infrastructure for gas export to Europe.

Alireza Gharibi, CEO of Iranian Gas Engineering and Development Company, said completion of 230 km of the 56-inch pipeline would provide the basic infrastructure for gas exports to Europe.

The 1800-km national pipeline network starts from Asalouyeh, Boushehr province, passes through the center, west and northwest of Iran, and reaches Bazargan border in West Azerbaijan Province

Construction of the 230-km stretch of the 9th pipeline is due to be completed by March 2016.

"Completing this pipeline would add 110 million cubic meters to Iran's gas export capacity," the official said. 

Gas export to Europe is a long-sought endeavor. During the government of former president Mohammad Khatami, negotiations were initiated with the UK, France, and Germany. 

Deputy Oil Minister Ali Majedi said Saturday there are three plausible routes to export gas to Europe: Turkey, Iraq-Syria-Lebanon, and Armenia-Georgia, among which Turkey is the most feasible.

Since Europe seeks to diversify its gas imports, it is a potential buyer of Iran's gas, said Majedi.  "Iran can also export liquefied natural gas (LNG), but this is subject to the construction of infrastructure similar to the 9th national pipeline."

In July, Iranian deputy oil minister Ali Majedi announced that the ministry has large-scale programs underway to export natural gas to European nations. "Europeans have shown deep interest in importing Iran's gas in a bid to relieve themselves from Russia's monopoly."

The oil minister Bijan Namdar Zanganeh was also quoted by IRNA as saying: "We are planning to export 80 billion cubic meters of gas to Turkey, Europe, Iraq, Pakistan, and the Persian Gulf Arab states in the Iranian calendar year 1400 (March 2021-22)."

Iran is the second-largest proved natural gas reserve holder in the world, behind Russia. Iran holds 17% of the world's proved natural gas reserves and more than one-third of OPEC's reserves. Iran's largest natural gas field, South Pars, is estimated to hold roughly 40% of Iran's gas reserves. However, the vast majority of Iran's gas reserves are undeveloped.

Iran exports natural gas to Turkey, Armenia, and Azerbaijan. A majority of Iranian exports goes to Turkey, and the remainder to Azerbaijan and Armenia.

 Armenia uses the majority of imported Iranian natural gas to produce electricity at the Hrazden power plant. In return, excess base-load electricity generated from the Armenian Nuclear Power Plant (ANPP) is exported to Iran.

 Iran's exports natural gas to the isolated Azerbaijani enclave of Nakhchivan via the Salmas-Nakhchivan pipeline. In exchange, Azerbaijan exports natural gas to Iran's northern provinces via the Astara-Kazi-Magomed pipeline.

According to the US Energy Information Administration (EIA), Europe, including all EU members plus Turkey, Norway, Switzerland, and the non-EU Balkan states, consumed 18.7 trillion cubic feet (Tcf) of natural gas in 2013. Russia supplied 30% (5.7 Tcf) of this volume. 

In the past, as much as 80% of Russian natural gas exports to Europe passed through Ukraine. This volume has fallen to 50-60% since the Nord Stream pipeline, a direct link between Russia and Germany under the Baltic Sea, came online in 2011.

The pipelines through Ukraine are currently the subject of political maneuvering as Europe and Moscow clash over the crisis in Ukraine.