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Joint Oilfield No More Viable

Joint Oilfield No More ViableJoint Oilfield No More Viable

Iran’s 13 year long dawdling over Esfandiar oilfield and Saudi Arabia’s increased extraction from the field, has ultimately made production unfeasible for Iran, Tasnim news agency cited the field’s contractor company, MAPNA, as saying. Esfandiar is an extension of the Lulu field in the Saudi-Kuwait Neutral Zone, and is shared between Iran and Saudi Arabia. According to preliminary estimates carried out over half a century ago, the oilfield contains 532 million barrels of light oil, with API gravity of 30.

Saudi Arabia has long complemented and diversified its crude oil basket with production from the field. Aramco, the Saudi Arabian national petroleum and natural gas company, has been exploiting the field since 1961, and extracted around 300 million barrels of oil from the field to date. Iran was expected to extract 260 million barrels of crude oil from Forouzan and Esfandiar fields, both jointly owned with Saudi Arabia, over a 25-year span. Since 2001 Iran started negotiations and even signed contracts for development of the field, but all to no avail.

MAPNA Group who recently expressed readiness to help the oil ministry develop the joint fields, was offered Esfandiar last year.  The ministry commissioned the company to carry out technical and feasibility assessments on the field, requiring it to prepare and submit a master development plan (MDP).  Following months of evaluation MAPNA eventually informed the ministry that development of the field is no longer economically viable for Iran. After 13 years of improvident extraction by the Saudis, Iran has forever lost its production opportunity from one of its joint fields.

Esfandiar field is located in the Persian Gulf, on the marine border line with Saudi Arabia, about 100 km southwest of Kharg Island.

 

Financialtribune.com