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Zanganeh Underlines Potential in Oil Equipment Production

Essential items such as drill bits, wellhead and downhole equipment are produced domestically.
Essential items such as drill bits, wellhead and downhole equipment are produced domestically.

Oil Minister Bijan Namdar Zanganeh says domestic companies have the potential to manufacture 85% of equipment needed by the in the oil and gas industry.

"If we proceed according to plans, up to 85% of equipment used in the petroleum sector can be produced by domestic companies," Zanganeh was quoted as saying by IRNA on Sunday.

Nearly two-thirds of demand for oil and gas equipment is met by domestic manufacturers, according the Oil Ministry officials.

The ministry has taken measures to boost domestic manufacturing of oil equipment in an effort to stem the outflow of capital. In 2014, a committee was set up to pursue the production of 10 major categories of equipment for the key oil and gas sector, including turbines and compressors.

Zanganeh also indicated that the government does not insist on indigenizing every piece of equipment.

"Production of some oil equipment is not viable. It is not for lack of knowhow, but simply because it does not make economic sense," he noted.

Essential items in oil and gas exploration/production, including various types of drill bits as well as wellhead and downhole equipment, are being produced by domestic manufacturers.

Iran also wants to expand the production of other pieces of equipment, such as control valves, pipes, rotating machines (turbines and compressors), smart pigs used in cleaning the pipes, oil and gas measurement tools as well as equipment associated with health and safety.

Zanganeh said that Iran is close to indigenizing the technology for producing corrosion resistant alloys (CRAs) – materials used for cladding pipes and equipment that increase resistance against corrosion and wear.

Iran was deprived of much-needed advanced technology and equipment to develop its oil and gas sector after the tightening of international restrictions in 2011 and 2012 that ostensibly targeted Tehran’s nuclear program but significantly undermined its oil exports, foreign trade and banking relations.

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