Khazar Exploration and Production Company welcomes international companies in the oil industry in the Caspian region but will not wait for them, the managing director said.
Speaking in a meeting in Tehran at the weekend, Ali Osuli said better results can be expected if international companies join the oil and gas projects in the Caspian Sea region “but we will not wait for them and continue our projects with the use of domestic talent,” the Oil Ministry news portal, Shana, reported.
KEPCO, a subdivision of National Iranian Oil Company, is an authority in exploration, development and production of oil and gas in the south of Caspian Sea (shared by Iran, Russia, Azerbaijan, Turkmenistan and Kazakhstan) and Iran’s three littoral provinces, Mazandaran, Golestan and Gilan.
Referring to the MoUs signed between KEPCO and some foreign companies in the past, Osuli said even if the companies do not uphold the agreements (due to the new US economic sanctions announced in November), KEPCO will continue its operations with the help of domestic companies.
Different Approach
The Caspian region is an old oil producing area in the world. It holds an estimated 48 billion barrels of oil and more than 8 trillion cubic meters of proven natural gas.
"In the past, the country's authorities viewed the Caspian region from a political and political prism. But today, given KEPCO’s exploration work, which led to the discovery of the Sardar-e-Jangal oil and gas field, the approach of higher-ups towards the sea has indeed shifted from political to economic viability,” Osuli said.
“After the discovery of the Sardar-e-Jangal oil and gas field, the approach of higher-ups toward the Caspian Sea shifted from political to economic viability”
However, among the five Caspian littoral states, Iran is the only one that has no oil and gas extraction operations in the region. This is due partly to the fact that most of Iran’s oil and gas fields are located in its southern half and in the Persian Gulf.
The challenges for Iran in extracting hydrocarbon resources from the Caspian Sea emanate mainly from concern about the depth of the water and the land-locked nature of the sea, which means closer collaboration with other countries in crucial.
Modern Technology
Iran has experience in the development and production of offshore hydrocarbon fields, especially in the Persian Gulf, but work in the Caspian Sea is a different story due to its depth and requires advanced technology at all stages of drilling, development, production and transfer, the KEPCO boss said.
The Sardar-e-Jangal field was discovered in 2001. According to initial estimates, it holds 1.4 trillion cubic meters of gas and 2 billion barrels of oil. Iran’s share of the oil would be about 500 million barrels.
Development plans for this deep-water oilfield is said to cost in the range of $7-10 billion. In November 2017, KEPCO and Norway's ORG signed a MoU to study the development of Sardar-e-Jangal oil and gas field off Gilan Province. However, the agreement has remained on paper.
Iran has divided its exploration area in the Caspian region into 46 blocks of which eight have priority. Two blocks are shared with Azerbaijan.
Last year, Iran and Azerbaijan signed an MoU on the "Joint Development of Relevant Blocks of the Caspian Sea" and agreed that the NIOC and Azerbaijan's SOCAR would produce and share crude oil from Caspian on a 50-50 basis.
