Russia's second-biggest oil producer Lukoil is in talks with the National Iranian Oil Company over oil swap operations, Oil Minister Bijan Namdar Zanganeh said.
"Lukoil has shown interest in concluding swap deals, but negotiations have not come to fruition yet," Zanganeh was quoted as saying by IRNA on Saturday.
If and when the two sides reach an agreement, oil swap could begin at 150,000 barrels per day and rise to 500,000 bpd soon after, the minister said.
Tehran and Moscow did not discuss swap agreements during Russian Energy Minister Alexander Novak's trip to Tehran this week.
A 300-strong delegation of Russian companies and businesses arrived in Tehran earlier in the week for the 13th session of Iran-Russia Joint Economic Commission. The two sides signed several agreements for cooperation in the energy sector.
"Oil swap can be an important source of revenue, as the northern neighbors with abundant hydrocarbon resources need access to sea lanes in the south," Zanganeh noted, saying that Iran swapped more than 254 million barrels of oil over 13 years and earned $880 million.
Commenting on obstacles that prevented Iran from expanding the oil swap deals in recent years, Zanganeh noted that the international economic sanctions, Russia’s rivalry with Iran over controlling energy export routes and political and economic instability in some parts of the region had undermined the oil/gas swap business.
Iran started crude oil and gas swaps with its neighbors in 2000, but the administration of former president Mahmoud Ahmadinejad suspended the contracts in 2010 unilaterally because of which Tehran was forced to pay $10 million in compensation.
Boosting Swap Capacity
According to the head of North Oil Terminals Company, Hamidreza Shahdoust, NOTC is ready to swap 120,000 barrels of oil per day at the behest of the Oil Ministry.
"We are ready to resume oil trade under swap deals with our northern neighbors through Neka Port in the Caspian Sea," Shahdoust said, adding that Iran is planning to raise the oil swap capacity by more than 12 times to 1.5 million barrels a day by increasing the number of oil terminals from 3 to 17.
"We will receive crude oil in the north for domestic consumption and export the equivalent from the Persian Gulf in the south," he said.
Neka used to be Iran's busiest terminal for conducting oil swaps in the Caspian region.
Add new comment
Read our comment policy before posting your viewpoints