Notwithstanding mounting US pressure to disrupt Iran’s oil export, Tehran will continue selling natural gas and liquefied petroleum gas to foreign markets, the newly elected head of National Iranian Gas Company said.
"LPG shipments, the bulk of which goes to China, are delivered regularly to customers," Hassan Montazer-Torbati was quoted as saying by Mehr News Agency Sunday.
Rejecting reports that LPG exports had been stopped due to the lack of LPG tankers, the NIGC official noted that LPG lifting never discontinued and shipping sources have confirmed that some of the gas cargo was destined for Thailand.
Oil Ministry data show LPG export in September declined to 356,000 million tons, after hitting 568,000 million tons in August, the highest since the first western nuclear sanctions were lifted in January 2016.
According to Global S&P Platts reports, Iranian exports are helping fill shortfalls in spot supply from the Middle East, as major producers Saudi Arabia, Qatar and Kuwait are exporting less spot cargoes and focus on fulfilling term contracts and meeting rising domestic petrochemical demand.
Referring to natural gas export via pipelines, Montazer-Torbati said Iraq and Turkey are receiving the fuel without any disruptions.
"As per the contract, Iraq so far has paid its gas bills in euros," he added, noting that officials in that country have said they may have to pay their debts in dinar.
"This has nothing to do with NIGC and the Central Bank of Iran should make the final decision in this regard."
According to the NIGC chief, “natural gas export to Basra in southern Iraq has commenced.” He did not elaborate.
Iraq buys 15 million cubic meters of gas per day from Iran via a pipeline and is Iran's second largest gas customer after Turkey whose imports amount to 30 mcm/d.
Iran is the world's third largest gas producer with 800 million cubic meters a day. But it is struggling to increase its footprint in international markets because most of what is produced is consumed domestically
Contract Renewal
Reportedly, Turkish officials have expressed interest in renewing the gas contract with Iran, and depending on prices, are willing to increase import volumes.
Montazer-Torbati said the contract to sell gas to Turkey expires in 2024.
"Talks to renew the agreement will start in 2021to remove all obstacles and forge a good deal."
NIGC believes that despite other alternative routes namely the Trans-Anatolian Natural Gas Pipeline, Turkey will import natural gas from Iran as it is economically viable. Moreover, it needs to meet its high winter energy demand, especially in the southern regions.
Iran is the world's third largest gas producer, producing 800 million cubic meters of gas a day. But it is struggling to increase its footprint in global markets because most of what is produced is consumed domestically.
Giving a breakdown, Montazer-Torbati said of the total output, power plants, the household sector and industries consume 40%, 26% and 30% respectively.
The rest is converted to compressed natural gas and helps in saving an estimated 23 million liters of gasoline per day.
Asked about the household sector, he noted that 1,139 cities and 27,000 small town and villages are connected to the national gas grid.
Phase 22
According to Farhad Izadjou, the operator of South Pars Gas Field phases 22-24 in the Persian Gulf, Phase 22 platform has become operational.
"The platform, installed last month, transfers close to 14 million cubic meters of sour gas a day to the onshore processing units via a 110km pipeline," he noted, adding that phases 22-24 should produce 56 mcm of natural gas, 50 mcm of methane, 2,900 tons of liquefied petroleum gas, 2,750 tons of ethane, 75,000 barrels of gas condensates, and 400 tons of sulfur on a daily basis.
South Pars is the world's largest gas field, shared between Iran and Qatar, spread over 3,700 square kilometers of Iranian territorial waters in the Persian Gulf. Iran is developing the mega gas project in 24 phases.
