UK Delegation Explores South Pars Megaproject

A delegation of private companies and investors from the British Chambers of Commerce explored opportunities for cooperation in Iran's South Pars megaproject in a meeting in Tehran last week.

The meeting was held between senior executives of the National Iranian Oil Company and Pars Oil and Gas Co. and senior officials from the British chamber, Shana reported on Monday.

"The British delegation included midsize companies offering a wide range of technical services in drilling, natural gas supply, erosion monitoring and the health, safety and environment (HSE) department," said Mohammad Ali Emadi, an engineering and development advisor to the NIOC.

The meeting was held at the request of the British side.

Iran is stepping up efforts to boost hydrocarbon output from the giant South Pars Gas Field, the world's largest gas field in the Persian Gulf that is shared with Qatar.

Tehran hopes to raise its natural gas output from the field to 900 million cubic meters per day by March 2017 to match Qatar's rate of extraction and ramp up production by a further 100,000 cubic meters a day in the following year.

Emadi said Iran is keen on foreign technology and investment to boost the recovery rates of its oil and gas fields, particularly those shared with neighbors.

"The new model of oil contracts will pave the way to fill in the technological gap in upstream projects," he noted.

The government has introduced a new model of contracts, known as Iran Petroleum Contract, to bring back internationals to help develop major oil and gas oilfields.

"We want foreign companies to expand cooperation with Iranian firms, which is a prerequisite in the new contracts, to levels above the pre-sanctions era," Emadi added.

Iran also expects to tap into the South Pars oil layer in six months after years of development. According to reports, Iran's gas production capacity is currently 600 mcm/d and there are plans to raise gas condensate output from the joint field to 700,000 barrels per day by March from the present level of 680,000 bpd.

Gas condensates are hydrocarbon liquids that possess the characteristics of both oil and gas. Condensates are classified as an extra light grade of crude by some sources.

South Pars is being developed in 24 phases. Phases 17-21 will start production this year and a major contract is slated to be signed to develop Phase 11, according to a statement from Oil Minister Bijan Namdar Zanganeh on Monday.