PEDEC Says Two Oilfields' Development to Cost $25b

Contracts worth $25 billion to develop two major oilfields in Khuzestan Province shared by Iraq may be signed within the coming months, Noureddin Shahnazizadeh, chief executive of Iran's Petroleum Engineering and Development Company (PEDEC) said.

"Estimates indicate that $25 billion in investment are required to develop Yadavaran and Azadegan Oilfields in the West Karun oil block," Shahnazizadeh was quoted as saying by Mehr News Agency.

According to the official, not only the development of the fields but also enhancing their recovery rate with the help of advanced technology is on the PEDEC priority list.

Pointing to memoranda of understanding signed with French energy major Total S.A., Anglo-Dutch oil and gas company Royal Dutch Shell and Japan's Inpex to conduct technical studies regarding the fields' deposits, Shahnazizadeh noted that the firms have been assigned to study the entire Azadegan Oilfield which is made up of northern and southern sections.

Known as Iran’s biggest and the world's third largest oilfield, Azadegan is located in the southwest of Khuzestan. The field's in-place oil is estimated at 33.2 billion barrels, of which 6 billion barrels are deemed recoverable. It is the biggest oilfield discovered in Iran in over three decades.

Dehloran, West Payedar, Naft Shahr, Azadegan, Yadavaran and Azar are fields shared by Iran and Iraq.

"Iran is now pumping 40,000 and 75,000 barrels per day from South and North Azadegan fields respectively," he added.

Underscoring the National Iranian Oil Company's agreement with international giants in March to study the oilfield, the official said foreign majors are expected to present their findings to the NIOC within six months of signing the agreements.

"As soon as the outcome of their technical survey is presented to NIOC, Azadegan Oilfield will be put out to tender." Plans are in place to hold a tender for the most-prized upstream project in early 2017.

Referring to Yadavaran Oilfield’s current output of 115,000 bpd, he said that the field is projected to produce 180,000 bpd and 300,000 bpd in its second and third development phases.

  Drilling in South Azadegan

According to Mehran Makvandi, the National Iranian Drilling Company's deputy director, NIDC has won a tender to drill 20 wells in South Azadegan Oilfield under the auspices of PEDEC.

"The drilling project will be implemented in the form of a turnkey contract, whereby NIDC is to design, procure and install the equipment and provide engineering services," he said.

"The company has already completed the drilling of 40 wells in South Azadegan."

NIDC's other operations include drillings in Phase 14 of South Pars Gas Field, Azadegan and South Yaran oilfields in Khuzestan as well as Azar field in Ilam Province. It  has already drilled an exploratory well at a depth of 2,900 km in Soufikom region in Aq-Qala County in Golestan Province, commissioned by Khazar Exploration and Production Company.