Iran is hard at work gaining a foothold in the global energy market, and it is not letting US President Donald Trump’s confrontational tone stop it from trying.
Political rhetoric is unlikely to turn into tangible impediments for Iran’s ambition to join Russia and Norway in the ranks of major gas exporters, according to Deputy Oil Minister Amirhossein Zamaninia, Bloomberg reported.
The nation has about $7 trillion worth of gas reserves sitting underground, based on European benchmark prices, and its doors are open to those who will help it cash in on the fortune.
Zamaninia thinks those sorts of figures mean the business case for Iranian energy is too tempting for the world to pass up.
The country may need as much as $100 billion to develop its gas business, but estimates vary widely. Majors from Royal Dutch Shell Plc to Total SA agreed to assess oil or gas fields in Iran last year, but no deals have been signed yet.
Total plans to sign a contract if Iran respects an international nuclear treaty and if the US sticks to it, Chief Executive Officer Patrick Pouyanne said in an interview. Austria’s OMV AG has said Iran’s gas market is “a big opportunity.”
“There are concerns and the international capital is scarce, but our projects and our environment are so attractive that we don’t think we will face a great deal of difficulty,” Zamaninia said in an interview last week at the CWC Iran LNG & Gas Summit in Frankfurt.
“We don’t think that the new US President Donald Trump's administration will pose a big problem in this department, in the oil and gas business.”
International politicking is delivering a “temporary hiccup” to investment, but Iran’s gas prize is big enough to motivate people to overcome their differences, Zamaninia said. The country has 56 gas fields with reserves of 33.7 trillion cubic meters, of which 40 are still undeveloped as a result of sanctions.
Hamid Soorghali, an energy analyst at Iran-focused consultant Energy Pioneers Ltd. in London, said that is probably true, and the country remains attractive to Russian and Chinese investors.
“Trump will not have an impact on this macro trend, but rather can only affect the quality of achieved goals,” he said by email. “Internal ambiguities and politicizations, such as over the price of gas for exports, can have more effect.”
Iran needs $70 billion to develop proposed oil and gas projects, and half of that could come through in a “few short months,” according to Zamaninia.
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