Russia’s state-owned oil company Zarubezhneft signed a trilateral deal on Wednesday with the National Iranian Oil Company and Dana Energy Company for the development of Aban and West Paydar oilfields near the Iran-Iraq borders.
The 10-year deal concluded by Zarubezhneft’s CEO Sergei Ivanovich Kudryashov, Dana Energy’s Chairman Mohammad Iravani, and Ali Kardor NIOC’s chief executive, marks Iran’s second deal within the framework of Iran Petroleum Contracts, the country’s new model of contracts for oil and gas projects, NIOC’s news portal reported.
This is Iran’s first oil contract signed with a Russian firm, Oil Minister Bijan Namdar Zanganeh was quoted as saying during the signing ceremony.
The agreement will be renewed with the Moscow-based oil enterprise in case of consent. The first IPC deal was concluded with the French energy giant Total S.A. in July 2017 to develop Phase 11 of the South Pars Gas Field in the Persian Gulf.
Direct and indirect costs of the plan are estimated to stand at $674 million and $68 million respectively. Russians have an 80% stake in the new joint venture, while Dana holds 20%. The initiative is aimed at increasing the fields’ current output at 36,000 barrels per day to 48,000 bpd in the period. The plan envisages adding some 67 million barrels more to the two fields’ extraction within a 10-year period. As per the agreement, the Zarubezhneft-Dana Energy consortium has been assigned not only to conduct technical surveys and maintenance, but also to equip wells with submersible pumps, oil separators and multi-phase flow meters in the first phase.
The second phase will revolve around supplying and installing oil and gas supply units, drilling eight delineation wells, installing submersible pumps, installation of permanent oil separating elements and application of 3D seismic surveys in the oil wells. The Russian firm is also conducting technical surveys on Shadegan and Rag Sefid oilfields near Ahvaz.
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.
Dana Energy is a private oil and gas company active in exploration and production, upstream services and energy trading.
Aban Oilfield in the western Ilam Province and West Paydar in Khuzestan Province near the Iraqi border are among dozens of Iran’s upstream exploration and production projects after the lifting of sanctions in 2016.
