The tender results for developing North Azadegan Oilfield in southwest Iran have been announced and Oil Industries' Commissioning and Operation Company will take on the project, the company's managing director said.
"The field's onshore development has been granted to OICO within a two-year deal, which could be extended to a period of five years," Mehrdad Davoudi was also quoted as saying by Shana on Thursday.
"OICO is preparing the ground to dispatch managing and operating groups to the zone soon," he added.
The deal has been signed within the framework of Iran Petroleum Contract, the country's new model of contracts for oil and gas projects.
--- Utilizing Domestic Potential
Davoudi said this is the first time all operations, including extraction, production and maintenance of an oilfield, have been outsourced to the private sector.
The official noted that the project follows the Oil Ministry's policy to utilize domestic expertise and potentials.
According to Oil Minister Bijan Namdar Zanganeh, multinationals, including Italian oil and gas firm Eni, Royal Dutch Shell, France's Total, Japan's Inpex and Malaysia's Petronas, had submitted their development plans to expand Azadegan Oilfield.
State-run China National Petroleum Corporation was handed the first development phase of North and South Azadegan oilfields. It was booted out of South Azadegan in 2014 after repeated delays in fulfilling its contractual obligations, although it has reportedly fared better in the North project.
OICO's chief added that the project will also create a huge job capacity.
"Plans have been outlined to hold technical training courses and workshops," Davoudi said.
Established in 2011, OICO manages and executes commissioning and startup operation, maintenance and training courses for oil, gas and petrochemical industries.
North Azadegan is part of a string of oilfields in the West Karoun block in the southern oil-rich Khuzestan Province near the border with Iraq. The block includes South Azadegan, Yaran, Yadavaran and Darkhoveyn fields, holding an estimated 67 billion barrels of oil in place.
The oilfield is owned by the National Iranian Oil Company and operated by Arvandan Oil and Gas Company. Currently, 80,000 barrels of crude are extracted from the field and further production rise depends on getting access to cutting-edge know-how.
The country is seeking to boost crude production from its joint fields with Iraq by 120,000 barrels under a short-term plan.
According to Gholamreza Manouchehri, the deputy head of the National Iranian Oil Company, involving domestic developers in Iran's oil and gas contracts is high on his company's agenda.
Officials say Iran is currently drawing crude from West Karoun block at an unacceptable extraction rate of 5-6%, but plans call for raising the recovery rate to 25% by implementing advanced recovery methods.
Manouchehri said plans have been devised to drill 100,000 wells in West Karoun in the next few years after financial constraints are removed. Tehran has prioritized the development of its joint oil deposits to expand its footprint in the global crude market.
The No. 3 producer of the Organization of Petroleum Exporting Countries has increased output to almost 4 million barrels per day.
