International energy giants, which can bring investment and technology to the oil-rich Iran, are awaiting the United States’ decision on the Joint Comprehensive Plan of Action, Iran’s nuclear deal with world powers reached in late 2015, a senior energy security analyst said.
“In the post-sanctions era, Iran followed a policy to recover lost ground in the energy markets by attracting foreign investment and technology, and raising oil and gas production,” Omid Shokri Kalehsar was also quoted as saying by ILNA on Saturday.
However, the country has only reached major energy deals with French oil and gas company Total on the development of South Pars Phase 11 and with Russian state-owned oil company Zarubezhneft on Aban and West Paydar oilfields near the Iran-Iraq borders.
“As these companies have not started the operational phase of the contracts yet, if the US pulls out of JCPOA and imposes sanctions on Iran, it is not unlikely that Total would withdraw from its project in South Pars,” he said.
Shokri stressed that according to Reuters, Indonesia’s state oil company Pertamina has also won a tender to operate Iran’s Mansouri field and it aims to sign a petroleum contract in early May.
Syamsu Alam, its upstream director, told reporters last month that Pertamina wants to increase oil production in Mansouri to 250,000 barrels per day from the current 60,000 bpd within five years to be delivered to Indonesia.
On Iran’s technological need in the energy section, Shokri said most Iranian oilfields are in the second half of their operational life cycle and their production rate declines by 8% per annum.
“To raise these oilfields’ extraction rate, investment and state-of-the-art technology are needed and any delay in attracting foreign finance and knowhow will lead to the country’s oil production drop, reduction in foreign exchange revenues and the gradual loss of Iran’s share in the global oil market,” he said.
Iran, whose major gas customer is Turkey, needs to find new buyers if the country wants to raise gas exports, which is only possible if it increases extraction from South Pars.
The official noted that South Pars accounts for 70% of Iran’s output and its production can drop if foreign energy companies with modern technology will not participate in its development.
Stressing that the situation is similar for Iran’s liquefied natural gas and renewables sections, Shokri noted that with a dynamic diplomacy, the country can manage regional tensions and retain its active role in the energy market.
Shokri believes that establishing close diplomatic relations with the neighboring states, namely Pakistan and Turkmenistan, can definitely help the country introduce its strategic commodities like natural gas and energy to overseas markets.
