Zarubezhneft Signs Deal to Survey 2 Khuzestan Oilfields

The National Iranian South Oil Company and Zarubezhneft signed a memorandum of understanding on Monday allowing the state-run Russian oil company to conduct technical surveys on two oilfields in the southern oil-rich province of Khuzestan.

The agreement was signed by Bijan Alipour, NISOC's managing director, and a top executive of Zarubezhneft in Tehran, NIOC's news portal reported.

According to Alipour, Zarubezhneft, a Moscow-based oil enterprise that specializes in exploration, development and operation of oil and gas fields, will conduct technical surveys on Shadegan and Rag Sefid oilfields near Ahvaz and will submit its proposal to enhance oil recovery in the fields in nine months.

Founded in 1967, Zarubezhneft's activities include the design, construction and operation of oil refineries as well as testing and export of know-how for oil recovery enhancement.

"Other companies and energy groups, namely Schlumberger Ltd, the world's leading oilfield services provider, Pergas Consortium, Pasargad Energy Development Company and MAPNA Group, are also studying the oilfields and each field will be awarded to a firm that fully complies with criteria determined by NISOC," Alipour said.

NISOC is assigned with the development of four oilfields in Khuzestan, namely Shadegan, Rag Sefid, Karanj and Parsi with a total of nine reservoirs, based on a special contract devised by the company.

According to Alipour, NISOC's model of contract conforms to the outlines of Iran Petroleum Contract, Tehran's new contractual framework geared to develop oil and gas projects in collaboration with foreign companies.

The official noted that Zarubezhneft is also in talks with NISOC to determine ways of raising production from Aban and West Paydar oilfields shared with Iraq in four to six months.

“Iran not only intends to cooperate with the Russian firm for financing oil projects, but also aims to employ the company's cutting-edge technologies,” he added.

With regard to the benefits of drawing on the experience of foreign firms, the NISOC chief noted that negotiations have been held with 33 international enterprises to cooperate in joint ventures and several memoranda of understanding have been signed and NISOC is gradually receiving the result of technical studies gradually.

Rag Sefid field, located in Khuzestan Province, was discovered in 1964 and its total reserves are estimated to be around 16.5 billion barrels.

Shadegan Oilfield, located 60 kilometers south of Ahvaz, was discovered nearly half a century ago and started production in 1988 following the end of the eight-year Iran-Iraq war. Production from the field is now reportedly at 70,000 barrels a day.