WASHINGTON, Oct 16 (IPS) - As the administration of U.S. President Barack Obama prepares for a critical series of talks about the fate of Iran's nuclear programme, Congress has begun moving long-pending legislation to impose new unilateral sanctions against the Islamic Republic. In just the past few days, the Senate approved a measure, already passed by the House of Representatives, that bans companies that sell Iran gasoline from bidding on contracts for the U.S. Strategic Petroleum Reserve (SPR). And the House Thursday approved by an overwhelming 414-6 margin the Iran Sanctions Enabling Act (IRSA) that would permit local and state governments and their pension funds to divest from foreign companies or U.S. subsidiaries with investments of more than 20 million dollars in Iran's energy sector. Finally, the chairman of the House Foreign Affairs Committee, Rep. Howard Berman, scheduled a vote for Oct. 28 on the long-stalled Iran Petroleum Sanctions Act (IRPSA) bill that would, if passed, impose sanctions on companies that are involved in exporting refined petroleum products to Iran or expanding Tehran's capacity to produce its own refined products.
Importance of oil revenues Overview of Iranian Government Budget in 2007 Table 2.1 Budgetary Funds: Ministry Sources and Recipients Total Revenue Total Expenditure (rials) (rials) Name Amount Percent Amount Percent Ministry of Petroleum 203,114,569 29 982,379 0 Ministry of Economic 13,024,047 19 1,976,503 0 Affairs and Finance Ministry of Agriculture 7,068,807 1 11,122,400 2 and Rural Development Police 2,977,800 0 13,535,660 2 Ministry of Education 573,495 0 13,783,746 2 and Training Ministry of Roads and 218,776 0 16,998,700 2 Transport Ministry of Science, 6,445,824 1 19,029,461 3 Research and Technology Ministry of Welfare and 1,701,000 0 26,599,314 4 Social Security Ministry of Education 960,454 0 27,740,254 4 Ministry of Health and 30,462,665 4 64,888,364 9 Medical Education Ministry of Defense 11,230,950 2 69,035,426 10 States Executive Organs 6,977,361 11 134,829,934 19 Other 197,951,357 33 236,741,475 44 Total 691,827,731 100 691,827,733 100 SOURCE: Based on numbers from Management and Planning Organization of Iran, 2007.
Statoil withdraws Facing mounting U.S. pressure, Norwegian energy firm StatoilHydro withdrew its interest from Iranian oil developments, officials said Friday. The U.S. State Department in July said it placed the actions of Statoil in Iran under review for possible violations under the Iran Sanctions Act, which established a cap on investment in the Iranian energy sector. In an announcement Friday, Statoil said it "will not make any new investments in Iran at this time," The Financial Times reported. "We have been evaluating our investment decisions and, having informed the authorities in Norway and the European Union and discussed the issue with the U.S., our view is that this position is in the best interests of shareholders and the company," Statoil chief Helge Lund said Thursday. StatoilHydro was formed by the 2007 merger of Statoil and Norsk Hydro. Statoil had expressed interest in developing the Azar oil field in the Anaran block in western Iran. Lund also suggested Statoil would withdraw from Iran's South Pars natural gas field by yielding control to the National Iranian Oil Co. sometime in 2009, The Times said. The move follows an earlier decision by French Total and Royal Dutch Shell. Statoil has expressed interest in moving into U.S. markets, particularly the Gulf of Mexico.
CFTC crackdown WASHINGTON, DC, Nov. 6 -- A former Bank of Montreal natural gas trader will pay a $500,000 fine as part of an agreement settling charges that he mismarked and misvalued the bank’s gas options book and deceived the bank, the US Commodity Futures Trading Commission said. It said that David P. Lee also would be banned from any commodity-related trading under a consent order imposed by Judge George B. Daniels in US District Court for New York’s southern district on Nov. 6. The order stemmed from CFTC’s Nov. 18, 2008, complaint that charged Lee with unlawfully mismarking his gas options positions between at least May 2003 and May 2007 and with misvaluing other gas options positions from October 2006 until May 2007. It also charged that Lee and various brokers deceived the Bank of Montreal by fabricating purportedly independent broker quotes delivered to the bank’s back office to verify prices. The order found that this conduct violates antifraud and false reporting provisions of the Commodity Exchange Act and CFTC regulations, the federal commodities regulatory agency said. Litigation against four other named defendants in the case continues, it added.
Emirates National Oil Company bids £1.1bn for Iran partner Dragon Oil Emirates National Oil Company (ENOC), the majority owner of Dragon Oil, has made a £1.1bn offer for the 48pc of the equity it does not already own, in a deal that would make the former chief executive of both companies £23m. Average daily production reached 40,992 barrels of oil per day in 2008 Photo: Reuters Dragon, which is already 52pc owned by ENOC, is focused on exploiting Turkmenistan's oil and gas reserves but exports 90pc of its output through Iran to international markets – making it politically unpopular. Its US-based broker Merrill Lynch parted with the company earlier this year. The 455p-a-share deal, recommended by an independent committee representing smaller investors, would lead to a windfall for Hussain Sultan, who served as chief executive of ENOC for 35 years and is still an adviser to Dragon Oil. He owns 5m shares in the explorer. The Dubai national oil company has been mooting a takeover of Dragon since June. This came several months after the company brought in KPMG, the accountancy firm, to examine "possible irregularities" and found "some individuals appeared to have obtained financial benefits for themselves by securing improper payments from certain contractors". City analysts suggested that the ENOC takeover undervalues Dragon's potential, although it represents a 35pc premium to the share price before the approach. In March, Dragon decided it would restructure its business into a Bermuda-incorporated holding company, as it posted a 30pc rise in pre-tax profits to $499m (£348m). Average daily production reached 40,992 barrels of oil per day in 2008, but the company recently warned it would miss its target of raising output by 15pc this year. The group is looking to secure assets in the Middle East, North Africa and Asia.
Does this meanIran expects to lose access to World Oil Bourses 27 October 2009 TEHRAN - The Iranian Oil Bourse was inaugurated on Monday in the Persian Gulf island of Kish as a venue to export oil and petrochemical products. National Petrochemical Company's Managing Director Adel Nejad-Salim said in the opening ceremony that all petrochemical products will be gradually offered on the market, IRNA news agency reported. The oil bourse is intended as an exchange market for petroleum, gas, and petrochemicals in various currencies, primarily the euro and Iranian rial, and a basket of other major currencies. On February 4, 2008 the Iranian Cabinet approved the creation of the oil bourse in two stages - first for crude and second for oil byproducts transactions. Iran, having the world's second largest gas reserves and third largest oil reserves, is trying to play a more active role in oil and petrochemical transactions in international markets.
Iran oil: No Change The Need To Restructure Iran’s Petroleum Industry (Revisited After Eight Years) By Narsi Ghorban Dr Ghorban, an oil and gas consultant for the past 30 years, is the Managing Director of NarKangan International Gas to Liquid Company, Director of Azar Energy Qeshm, Director of Qeshm Energy International and Director of International Institute for Caspian Studies. He is a fellow of Institute of Energy, member of the International Institute for Strategic Studies, member of the Royal Institute of International Affairs and a member of the Iran Association for Energy Economics. This article for MEES represents his personal views of the major issues facing the Iranian oil and gas industry. In September 1997, a few months after the landslide victory of President Mohammad Khatami in Iran’s presidential election, I wrote an article for MEES with the same title as the one above (MEES, 22 September 1997). I pointed out the historic importance of the first election in Iranian history to be won by the younger generation and predicted that “if the optimism and democratic activism of this huge electoral force are not matched by immediate and constructive government policies aimed at improving social and economic conditions, the consequences could be disastrous for Iran and the region.” I also said it was the duty of all Iranian professionals, experts and academicians to assist the government in formulating policies, which would help to bring about the necessary changes to cater for the needs of the next generation in Iran. After nearly eight years, the second term of President Khatami is coming to an end and I believe it is again the moral duty of the above-mentioned people to evaluate the achievements and failures of his term with regard to social, economic, political and strategic aspects, and to learn from them. Many experts have commented on the social, economic and political problems facing Iran in the coming years, individually or collectively. Eight years ago I gave my views on some of the basic problems associated with our oil and gas industry, which I believe is the engine for economic growth in Iran. In this article I would like to revisit the same issues. In my previous article I urged the new administration to address five major issues in restructuring the Iranian petroleum industry in order to cope with the changes in the world petroleum industry. Those topics were: * The separation of the Oil Ministry from the state oil and gas companies (the separation of politics from commerce). [2009 Comment: 2008 Production estimated at 3.8mn b/d. Oil ministry ineffective + Sanctions!!!!] * The creation of a strong and effective national gas company and, if needed, legislation for a modern comprehensive gas law. [2009 Comment: Iran is the second-largest oil producer in the Organization of the Petroleum Exporting Countries (OPEC). It pumps around 3.8 million barrels per day (bpd) of oil, around 4.5 percent of global supply. Oil supply, exports and refining operations have been unaffected by 10 days of protests in Iran.Nozari's efforts to increase crude production capacity and to become a major gas exporter have been hampered by sanctions over Iran's nuclear programme, which limit its access to funds and technology.] * Finding a suitable legal and commercial framework to attract domestic and foreign capital and technology to the oil and gas industry. [2009 Comment: Iran has to address the rapid decline in oil production from the old fields, which is currently estimated to be over half a million barrels per day each year. This is a major challenge, which requires a transfer of up to date technology in enhanced oil recovery techniques, development of gas resources to be injected into old oil fields, and huge capital investment in developing new oil fields. If the political circumstances improve and the right economic incentives are offered, the transfer of technology and the much needed investment would be forthcoming. The present legal framework "buy back" service contracts is neither attractive to international oil and gas companies nor popular among many experts within Iran. In addition, these types of contracts have failed to bring Iran up to date with recent technological advancements. In general, the interaction between Iranian scientists in various fields with their counterparts around the world has been limited. Unless serious changes in policies are made, the technology gap will widen, with serious consequences for the industry in general and the oil and gas sector in particular.] * The adoption of a more transparent approach to the oil and gas sector, and proper accountability of the industry. [2009 Comment: He then focused on the oil industry and asked, “How is the government approach to oil? Once we may consider oil as revenue and spend it on current expenses. But we may also not consider oil as revenue, but an asset which should not be spent on everyday expenses. Oil should be turned into assets on the ground. The Oil Stabilization Fund was a mechanism thought of to do this in the First Economic Development Plan. Under Mr. Khatami, we drew five to six billion dollars from the Fund.” Zangeneh then pointed to billions of dollars worth of projects implemented in his time, and said, “If you need 1,000 billion dollars, you don’t need to have all that money. It would suffice to have 200-250 billion dollars and attract 750-800 billion dollars through finance. That is you can attract four dollars for every dollar that you have.” He then explained about Iran’s oil revenues in the past four years and said, “During those four years, we have earned 290 billion dollars through oil sales all of which has been spent on import of goods which were not industrial machinery or capital goods. If we had worked according to the Fourth Economic Development Plan, we should have had more than 170 billion dollars in the Oil Stabilization Fund through which we could have implemented 680 billion dollars worth of projects. How many projects have been given to domestic contractors? I am very sorry that the government has spent all that money and it is still indebted to all contractors. What has happened to that money? If you were bent on developing the country, you should have given the money to contractors, but you haven’t.”] * The creation of the right atmosphere for wider private sector participation in Iran’s oil and gas industry. Opening ceremony On February 17, 2008, the Iranian Oil Bourse was inaugurated in a video conference ceremony from the capital Tehran attended by ministers of oil, finance and economic affairs as well as chairman of Iran's Stock Exchange and a number of other officials and financial experts.[4] The transactions will be made in Iranian rial, yen, euro and other major currencies.[5] The Iranian Oil Bourse will probably accept Russian ruble as well.[6] The first transaction of the IOB took place at 9:30 the following morning, when 2200 tonnes of low density polyethylene (LD-PE), held in 100 tonne cases, were traded.[3] November 2008: According to Chairman of Board of Directors for Iranian Oil Bourse Mehdi Karbasian ever since the launch of the first phase of the bourse, transactions worth over $1.5 billion have been made on different oil and petrochemical products.[28] December 2008: Iran is permitting local private firms and not just foreign companies to enter the trade in Iranian crude. One organization that could now trade was Bonyad-e Mostazafen va Janbazan - a body that helps the underprivileged and war disabled, or a charitable trust with business interests. [2009 Comment: Bonyad-e Mostazafen va Janbazan Private Sector??] Conclusion Iran’s oil and gas industry, celebrating its 100th birthday in 2009, has been the most significant factor in the economic, social and political development of the past 50 years. The need to restructure this industry and bring it into line with world petroleum market forces is vital for the country’s role in the 21st century. [2009 Comment: Getting worse due to mismanagement]
Main Menu Home CFPA News About Us Oil Industry Support Floating Rigs/FPSO Subsea Dock Facilities Renewable Energy Facilities Cruise Bulk Conservancy Downloads Search Contact Us Where we are Location Map Please click map for more detail Email for more information or Tel: +44 (0) 1349 852308 Oil Industry Support The Cromarty Firth is the premier port in Europe for oil-rig Inspection, Repair and Maintenance with upwards of 300 rig days alongside annually for this purpose. It is also a leading service base for the Subsea industry jack-up service_base_for_the_subsea_industry The Port is an open user facility where oil-related companies can employ their own engineering and fabrication services, as well as using other local service providers. There are also companies available with experience and facilities to manage complete projects. Local companies provide a wealth of expertise and experience and are recognised internationally as leaders in their fields with no labour restrictions, 24 hour working, all required trades available, and a flexible approach to meeting clients' requirements.
spread the idea that oil money should be spent for civlian projects rather than military. make graFfiti - OIL PROFIT TO CIVILIAN PROJECTS! if you want to make revolution succesfull you need support from low class and workers. and they are more concerned about quality of life than philosophy and ideology...
Impact of sanctions and mismanagement Analysis: Iran's oil shortfall 30-09-09 Iran's new Oil Minister Masoud Mir-Kazemi has spelled out the dire situation facing Islamic Republic's energy sector, revealing a gas shortfall of 200 mm cmpd is likely during the peak season, together with a multi-bn dollar project finance deficit. IHS Global Insight Middle East energy analyst Samuel Ciszuk gives his expert opinion on what this means for Iran's energy sector. Outlining the problems facing his ministry on the outset of his tenure, new Oil Minister Masoud Mir-Kazemi was quoted as saying that he foresaw a gas shortage during the winter peak demand season of about 200 mm cmpd, which likely would translate to heating and electricity shortages in some of its most populated areas. Appearing to want to reset expectations, Mir-Kazemi countered previous optimistic official Oil Ministry estimates, which maintained that Iran would not need any additional gas imports to meet its spiralling domestic demand thanks to rapid upstream development at its vast South Pars offshore gas field in the Gulf. The previous optimistic estimates-likely a product of the government's re-election campaign-resulted in no allocations for diesel imports in this year's budget, meaning that the already strained Iranian state finances will suffer, with much of the burden likely being carried by the Oil Ministry's own capital expenditure budget. Iran has bought its first diesel cargo for about six months, for a likely September/October delivery, as it commences on an inventory build-up operation. The news come just a month after Iran halted all its exports of diesel and indicates that the Oil Ministry is preparing for the use of diesel as feedstock in some of its gas-fired power plants-an expensive measure suitable only to stave off emergencies. Iran has suffered severe gas shortages in previous years, as it has been unable to match its spiralling domestic gas and electricity demand growth by similarly speedy upstream and downstream developments of its vast reserve base. Iran does not need only to develop the upstream production and the treatment facilities for its gas. Its geography also places on it the need to invest in long and relatively expensive pipelines, carrying the gas from its lowly populated southern and south-western Gulf shore over the central mountains to its densely populated mountainous north. Because of a lack of sufficient funding-aggravated in the past years also by a spike in steel prices-Iran has not been able to install sufficient gas transport capacity to its main population areas, leaving large parts vulnerable to the previous year's gas-price dispute with Turkmenistan. Funding pressure Iran remains one of the OPEC member countries most vulnerable to oil-price fluctuations, with the virtual doubling of the oil price since last year's low only having rescued it from vast deficit, without placing it on a sure financial footing. The extent of Iran's financial woes was further underlined by Mir-Kazemi saying that "there are around $ 19 bn worth of incomplete projects in the gas industry for which there are only $ 3 bn of budget allocated," resulting in a project finance shortfall of $ 16 bn in 2009 just within the country's gas sector. Mir-Kazemi was also quoted adding that the National Iranian Oil Company (NIOC) currently only had ready available cash reserves of about $ 103 mm. Iran has previously announced that it will look to the financial markets to raise project finance, as well as issuing sovereign debt, with a report saying that state-owned NIOC subsidiary Pars Oil and Gas Company (POGC) -- the company tasked with overseeing the development of the South Pars reservoir -- is preparing the issue of a EUR 1-bn ($ 1.4-bn) bond. The Eurobond is hoped to finance some of the immediate development of the South Pars, which official Iranian sources recently estimated would require $ 40 bn to be developed in full. That number is, however, likely including the stalled LNG export projects, which look impossible to move ahead under the current international sanctions and in any case might struggle to receive their gas feedstock allocations in a few years' time if Iran's domestic demand continues to spiral. Given especially the unilateral US financial sanctions imposed on Iran for its controversial nuclear programme-but also the multilateral UN restrictions-Iran's ability to raise finance and for investors in Iran to transfer money in and out of the country have already been severely constrained. Even Chinese and Russian companies-initially eager to take the place of Western oil companies and sign memoranda for potentially lucrative contracts-have over the last two to three years showed themselves unwilling to commit financially by translating their memoranda of understanding into proper contracts. Outlook and implications Iran's gas consumption is continuing to spiral, throwing all its export ventures into question while in the short-to-medium term making it impossible for the country to meet domestic demand with its depleted upstream development budget. With gas consumption in Iran being 3.5 times higher than in Turkey and 10 times higher then in Japan per capita according to Mir-Kazemi and growth averaging 10 % per year, new production policies conducive to the long-term health of reservoirs in the oil and gas fields have to be developed. These pressures, together with the inability to fund projects anywhere near meeting its demand, are likely to force reform of its subsidy system, although this will have to be carefully managed to avoid placing large parts of the Iranian population outside the electricity and heating market during the coldest part of the year. The severe financial shortages throughout the Iranian gas sector are also likely to continue making it very vulnerable to any additional international sanctions. This might politically work in its favour, as the international community might be wary of imposing fuel sanctions on Iran if they look likely to be as taxing on the civilian population as the sanctions against Iraq during the 1990s. With fuel shortages developing in Iran in a few months' time, likely resulting in rolling blackouts, the readiness to burden the Iranian society further might disappear. In any case, current sanctions have already largely stopped the inflow of capital and technology into its energy industry, significantly aggravating the problems that Iran has had in the making for decades. Source: Arabian Oil And Gas | ArabianOilandGas.com
Guaranteed future for our young generation fighting for fredom Iran has an enormous energy output gap: the reserve-to-production ratio of, say, Russia for natural gas applied to Iran would yield 33 bcfd of gas production and for crude oil would yield 20 million b/d of Iranian oil production—4 and 4.8 times, respectively, its current rates of output. Iran is centrally located between European and Asian energy markets and is courted by eager buyers of oil and gas. Yet the regime insists on aggressive politics, pursues threatening nuclear technology, manipulates the international oil price through OPEC, and drives a wedge between energy demand and supply at home by limiting consumer prices while impeding foreign investment. Iran does not need nuclear energy; it needs to reconnect with the world, realign its disjointed priorities, and develop its vast oil and natural gas resources.
Iran - Falling foreign investment diminishing oil income Iran - Falling foreign investment diminishing oil income By Sayeh Sabz Tuesday, 08 December 2009 21:30 iran_oil A recent study in Iran has shown that the country is in dire need of investment in its energy industry, without which it may suffer grave consequences. A leading official think-tank affiliated to Iran’s parliament, the Majlis Research Centre, issued a report in October 2009 saying that Iran needed at least 4.5 billion US dollars of investment in its energy industry. Otherwise, it added, in the worst-case scenario Iran would have to stop oil exports in eight years. Whether realistic or not, the report gives a stern warning to Iranian officials that their nightmare of diminishing oil income may be about to come true in a country where 85 per cent of the annual budget is funded by such revenues. Although President Mahmoud Ahmadinejad uses every opportunity to defend and praise his economic policies, Iran’s ailing economy has even led the president’s allies, including conservative members of parliament, to harshly criticise the government and even suggest the possibility of impeaching the president, according to Aftab-e Yazd daily on December 7. But how did Iran end up here? A combination of bureaucracy, wrong foreign policies, sanctions and corruption have brought Iran’s energy industry to its knees, making it hard for foreign investors. The roller-coaster of bureaucracy in Iran, bottlenecks that a contract has to go through before being signed, inconsistency and officials’ indecisiveness are just parts of the diseased contract system in Iran. Politics plays its own key role in what contract should be awarded to which favoured company. When Ahmadinejad took power four years ago, foreign investment, particularly by European-based international oil companies, was on the rise. Under the previous reformist administration of Mohammad Khatami, the French oil giant Total, then TotalFinaElf, defied United States sanctions and became the first of many European and foreign companies to come to rescue Iran’s war-hit oilfields. Although not a big investment boom, the positive trend promised to maintain a flourishing energy industry to allow Iran to retain its position as the second largest Organisation of the Petroleum Exporting Countries, OPEC, producer. But with the major shift of policy in Iran’s foreign relations and economy under Ahmadinejad’s hardline administration, Iran may find it hard to keep on the same track. Ahmadinejad’s “look to the east” policy brought about rather sudden changes and, in less than four years, the country’s energy sector has become a playground for Russian and Chinese oil companies while their western counterparts are growing cautious over investment. However, it would be untrue to say that Iran had suddenly turned to Chinese companies with the arrival of Ahmadinejad. Indeed, less than a year before he came to power, the country signed a major memorandum of understanding with Beijing promising investments of up to 100 billion dollars by Chinese firms in Iran. In line with the memorandum, China’s Sinopec was awarded a multi-billion-dollar deal in November 2009 to develop Iran’s Yadavaran oil field. The presence of Chinese firms in Iran’s oil and gas industry has significantly increased in recent years. Russian, Turkish, Indian and Belarus companies have also joined the European firms that were already in Iran prior to Ahmadinejad’s arrival. In 2005, after a long chase for a major oil contract, British Petroleum ended its Iran programme citing the high risks attached to investment there, such as US sanctions. The company was followed by British Gas and, most recently, by Brazilian Petrobras and Norwegian StatoilHydro. Alongside the policy shift by the Iranian government, its bureaucracy and oil apparatus have caused the country to suffer considerably. Whether western or eastern, oil companies will have to go back and forth in a maze of Iranian departments, ministries and the parliament in order to kick-start a project. And even then, they are not safe from contractual hiccups, as could be the case with any other country. But sometimes the stalling does not come from the Iranian government; indecision by European firms in the face of increasing global pressure and sanctions can cost them lucrative contracts. The most recent example was the elimination in December 2009 of France’s Total from South Pars gas field’s Phase 11 development, which Tehran said was being delayed “excessively”. Total and Iranian officials had been discussing the corporate development of Phase 11 and production of liquefied natural gas from produced gas since 2004. After almost five years, the contract was eventually awarded to another contract-hungry Chinese firm, China National Petroleum Corporation, CNPC, and Total has been told that it would be “welcome” to cooperate with the Chinese side if interested. It is too early to decide whether the Iranian romance with the east has been affected by both China’s and Russia’s vote against Iran at the United Nations nuclear agency in late November and Russia’s failure to deliver on time the Bushehr nuclear power plants and S300 missiles to Iran. So far, Tehran has not taken a strong position against the two countries, with Ahmadinejad describing Russia’s vote against his country as a “mistake”. What is clear, however, is that the Iranian government is in dire need of investment, whether foreign or domestic, in its oil and gas industry. But under current pressures and sanctions and with Ahmadinejad facing a legitimacy crisis after the June 2009 presidential elections, the prospect of further western investment in Iran becomes less and less likely. Whether Iran’s change in its foreign policy will pay off and whether it will efficiently manage its dwindling energy resources, dilapidated oil industry and increasing energy demand in the near future remains to be seen. Global Arab Network
Multinationals invest in Iraq/Diminishing Iran Oil FDI Shell, CNPC groups win Iraqi oil deals Dec 11, 2009 By OGJ editors HOUSTON, Dec. 11 -- The Iraqi oil ministry awarded service contracts for development of giant Majnoon and Halfaya oil fields in the first of 2 days of bidding by 45 companies. Royal Dutch Shell PLC and Petronas won the contract for Majnoon field in southern Iraq. The combine—Shell 60% and Petronas 40%—bid plateau production of 1.8 million b/d of oil and a fee of $1.39/bbl of increased production. The field now produces about 45,000 b/d. The Iraqi government retains 25% participating interests in all licenses. In 2003, former Iraqi Oil Minister Issam Al-Chalabi estimated original oil in place for Majnoon at 38 billion bbl and original reserves at 12 billion bbl (OGJ, Mar. 24, 2003, p. 42). The field is north of Basra near the Iranian border. The contract for Halfaya field, between Majnoon and the city of Amara, went to a consortium led by China National Petroleum Corp. bidding plateau production of 535,000 b/d and a fee of $1.40/bbl. Current production is 3,000 b/d. Combine interests are CNPC 50% and Total SA and Petronas, 25% each. For Halfaya, Al-Chalabi estimated original oil in place of 16 billion bbl and original reserves of 4.6 billion bbl. Six fields drew no bids during the first day, possibly due to insecurity or proximity to residential areas. Fifteen fields were open for bidding.
Lukoil wins Iraq oilfield contract/Diminishing Iran Oil FDI Lukoil wins Iraq oilfield contract Iraq is looking to boost it oil output in order to kickstart its economy [AFP] Iraq has signed an agreement with Russian energy company Lukoil to develop one of the world's largest untapped oil fields. Lukoil on Saturday agreed the deal, giving it access to the West Qurna-2 reservoir, a day after consortiums led by Shell and CNPC were awarded contracts for other oil fields. "We can announce that Lukoil has won the contract to develop the West Qurna-2 oilfield," Hussein al-Shahristani, Iraq's oil minister, said. Iraq has so far reached seven oil deals over the course of the two-day auction, making agreements that promise to boost Iraq's oil production by more than 4.7 million barrels per day (bpd) in the coming years. Split of revenues Lukoil and StatoilHydro, the Russian company's Norwegian partner in the West Qurna-2 project, requested $1.15 for each barrel extracted from the oil field. Lukoil will take 85 per cent of the revenue from extraction, while StatoilHydro will take the remainder. The companies expect to extract 1.8 million barrels a day from the field. West Qurna-2, which has known reserves of 12.9 billion barrels, lies to the west of the Majnoon field, which was auctioned on Friday to Shell, an Anglo-Dutch company, and Petronas, a Malaysian firm. Shell and Petronas will get $1.39 for each barrel of oil they extract from Majnoon, which has proven reserves of 12.6 billion barrels. CNPC, a Chinese firm, led a group comprising Petronas and France's Total on Friday to get access to the southern Halfaya oil field. Each company in that consortium will receive $1.40 per barrel, based on projected production of 535,000 bpd. Output target Contracts were also agreed for access to the Garraf, Najmah, Qaiyarah and Badra fields. Sonangol, an Angolan firm, will work in the Qaiyarah and Najmah oil field, which lie in the northern province of Nineveh. A joint bid from Petronas and Japex, a Japanese company, took the Garraf field in south Iraq, while a consortium led by Russia’s Gazprom was awarded a contract to work on Badra, near the Iranian border. Oil firms avoided bidding for fields in the most dangerous areas of the country, while companies that did not offer enough value for money were refused the chance to work the oil fields. The auctions, the second to be held since June, come as Baghdad looks to kickstart its economy and generate income for the government. Iraq hopes to raise oil production to seven million bpd within six years, from the current output of 2.5 million bpd. At 115 billion barrels, Iraq has the world's third-largest proven oil reserves, behind only Saudi Arabia and Iran. Oil sales provide 85 per cent of government revenues.
Iran Geostrategic partners have now changed their strategies Iraq Oil bidding process is highly important because it is giving oil contracts to oil companies based in Iran Geostrategic partner countries. Shell, Total, CNPC, Petronas, Lukoil, Statoilhydro. This is extremely significant for Iran Oil industry and the countries Geostrategic position within the middle East. It seems as though Obama's change in politics and his approach towards Russia/China are now showing isolation process of Iran regime!!!
Iran Plans 100 Billion investment in next 4 years. Highly unlikely after Iraq Oil bid Iran's parliament warns against drop in oil exports Sat, 24 Oct 2009 11:16:32 GMT An Iranian parliamentary center has warned that Iran's oil exports may face a plunge due to depreciation of oil wells and a jump in domestic consumption. Strategic Majlis (Parliament) Research Center said in its latest report that the oil industry needs an annual $5.4 billion investment to keep the current volume of crude exports. "Regarding negative investment growth (in the oil industry), supplying this amount of the investment is unlikely," Fars news agency quoted the research center as saying. Iran, the world's fifth-largest oil exporter, put its oil production capacity at 4.3 million barrels per day (bpd). The center says the 'serious and fundamental investment' is necessary for the oil-rich country. In June, former Iranian Oil Minister, Gholam-Hossein Nozari, said that Iran plans to invest $100 billion during the next four years in different sections of its oil industry. "Several projects, including the development of North Pars, Golshan and Ferdowsi gas fields will be operational in the next four years," said Nozari, who added that the total investment in Iran's oil projects has been $66 billion in the past four years. He went on to say that many people (in the beginning) did not believe this amount of investment could be made, but that investment has now turned into real operational projects, including the Mehr Petrochemical Complex.
Iran warns Iraq and tries to minimize regional/Global Geostrategic shift Iraq accuses Iran of seizing oil well near border By REBECCA SANTANA Associated Press Writer Iranian forces crossed into Iraq and seized an oil well just over the two countries' disputed border, Iraq's government said Friday, prompting a protest from Baghdad and providing a dramatic display of the sometimes tenuous relations between the wary allies. The incident could trouble Iraq's drive to attract the international investment needed to develop its beleaguered oil sector, analysts said, and it raised questions about the two countries' ties, which had improved greatly after the fall of Saddam Hussein. According to Iraq's deputy foreign minister, Mohammed Haj Mahmoud, Iranian troops crossed into Iraqi territory on Thursday and seized oil well No. 4 in the al-Fakkah oil field, located in Maysan province about 200 miles (about 320 kilometers) southeast of Baghdad. The oil field is one of Iraq's largest. "This is not the first time that the Iranians have tried to prevent Iraqis from investing in oil fields in border areas," Mahmoud told the AP. He said he did not know if the Iranians were still in control of the well. Iraq's national security council held an emergency meeting Friday to discuss the issue, and government spokesman Ali al-Dabbagh later said the seizure showed anew the need for clearly defined borders between Iraq and Iran. He said the two countries have begun diplomatic talks. However, al-Dabbagh appeared careful to avoid describing the incident as a military incursion, saying the oil well takeover was carried out by a group of armed Iranians. "Iraq considers this penetration as a border breach and a violation of Iraq's sovereignty," he said in a statement. "We call upon the Iranian government to solve all the border disputes with Iraq through diplomatic means and to avoid the use of military force." Relations between the two countries have improved dramatically since the 2003 U.S.-led invasion toppled Saddam, who in the '80s attacked Iran and started an almost decade-long war. Since Saddam's ouster, however, both countries have had Shiite-led governments, a rarity in the mostly Sunni Middle East. But their border remains in dispute. The al-Fakkah field is considered a shared field between Iran and Iraq, meaning both nations are able to pump oil from it, but the Iraqis consider oil well No. 4 theirs. Iranian soldiers carrying rifles seized the well Thursday night in a 25-car convoy and ordered the Iraqi workers to leave the area, according to a worker at the site who did not want to be identified for fear of retribution. The soldiers then mounted an Iranian flag inside the well, he said. There were no reports of violence during the incident, and Iranian forces left the well on Friday, leaving the flag behind, the worker said. His account could not be immediately confirmed. Analysts said it was too early to say whether the incident would mushroom into greater tension but said it could raise concerns with oil companies looking to invest in Iraq. Oil prices rose slightly after news of the incident. "It looks like some kind of warning shot, and it could definitely escalate into a big worry for oil companies," said Samuel Ciszuk of the London-based IHS Global Insight. In Washington, a U.S. official said that although Iranians have crossed the border before, they had not previously ventured this far. Iraqi security forces were in the area, but there are no reports of fighting, he said on condition of anonymity because he was not authorized to speak on the record. The Iranians are believed to have left the area, he said. An official at the Iranian Embassy in Baghdad who did not want to be identified because he was not authorized to speak to media said reports of Iran seizing the well were "mere rumors."
Geostrategic slide is continuing Iraq, Shell ink deal on supergiant Majnoon field Muhanad Mohammed BAGHDAD Sun Dec 20, 2009 6:46am EST BAGHDAD (Reuters) - A group led by Royal Dutch Shell, Europe's largest oil company, signed a deal to develop Iraq's Majnoon supergiant oilfield, pledging to spend tens of billions of dollars on the project over the next two decades. Shell, along with Malaysia's state-run Petronas, won the rights to Majnoon, a major prize near Iraq's southern oil hub of Basra, in an energy auction earlier this month. Mounir Bouaziz, a vice president of Shell Gas and Power, and Abdul-Mahdy al-Ameedi, deputy director of the Iraqi Oil Ministry's licensing office, signed the initial agreement in downtown Baghdad on Sunday. It must now be sent to the cabinet for approval. Bouaziz said the investment over the life of the 20-year deal would be "tens of billions" of dollars. "When the cabinet give agreement to the contract, and the final contract is officially signed, we will start immediately. We know the area, and we have been coming to Basra for more than a year and a half," he told reporters after the signing. Shell is waiting for final approval of a natural gas deal also located in southern Iraq, which it will take on in partnership with Mitsubishi. Then there is Exxon Mobil and Shell's initial deal for West Qurna Phase One, a field left over from an initial bidding round that concluded in June. That field has reserves of an estimated 8.7 billion barrels. Majnoon is even bigger. With a whopping 12.6 billion barrels, Majnoon is one of the world's largest untapped fields. Iraq is hoping a host of deals in the works will turn it into a major world energy player and increase output capacity to 12 million barrels a day (bpd) in six or seven years, putting it close on the heels of global leader Saudi Arabia. Output now stands around 2.5 million bpd as the industry struggles to overcome the legacy of continuous war, sanctions and underinvestment over decades. Oil officials have been in a triumphant mood since the December 11-12 auction, which awarded seven contracts to foreign firms. For Majnoon, the Shell group proposed a per-barrel remuneration fee of $1.39 and pledged to increase output to 1.8 million bpd from a current production level of 45,900 bpd. Shell has a 60 percent stake in the consortium, while Petronas holds 40 percent.
Oil Majors win Iraq block - Iran FDI? 1) Shell - unlikely to continue Iran investment 2) Petronas - unlikely to continue Iran investment. Unreliable contractual partner 3) Exxon Mobile - unlikely to invest in Iran oil 4) Total - Still discussing investment but not allowed to follow through with investment in Iran 5) CNPC - Can invest in Iran but lacks expertise. "Analyst IHS Global Insight said PetroChina is “keen to cooperate with Chevron given its own lack of technical expertise in developing high-sulfur fields, which was tragically demonstrated in 2003 following a blowout at the No. 16 well of Luojiazhai field, which killed around 200 people.” Oilfield Services In Iran, CNPC provides engineering and technical services ranging from geophysical prospecting, well drilling, logging and perforation to formation testing. In 2007, we had two geophysical prospecting crews, four drilling (workover) crews and 18 logging and testing crews operating in Iran. In the contractual drilling operation in southern Iran, serious circulation loss, blow-out, wellbore collapse, drill pipe sticking and necking occurred during air drilling in a 36-inch borehole. These were tackled with the use of gas-liquid-solid ebonite foam technology. The drilling cycle was reduced from 197 days to 45 days through optimizing drilling parameters and drilling fluid formula. 6) Lukoil - Will not invest in Iran Oil due to US sanctions 7) Statoil - Developed and handed over oil field operations to NIOC. Unlikely to continue investment in Iran 8) Japex - Developed and handed over oil field operations to NIOC. Unlikely to continue investment in Iran The list of potential partners for Iran Oil FDI have diminshed greatly. The mid and long term decline of Iran oil production is highly likely as only high technical expertise will improve deteriorating and ageing oil fields. Look for Iran to maximize short term oil revenues through increased border and geopolitical tensions.
Bomb attack halts Iraq-Turkey oil pipeline for 4 Days Bomb attack halts Iraq-Turkey oil pipeline Tue Nov 24, 2009 7:05am EST (Adds details) BAGHDAD, Nov 24 (Reuters) - A bomb attack in Salahuddin province damaged the Iraq-Turkey oil pipeline more than four days ago and the damage will take up to four more days to fix, an Iraqi Oil Ministry official said on Tuesday. The official, asking not to be identified, said a memo from the North Oil Company received by the ministry on Monday stated the attack had occurred between the village of Shirqat -- a former hotbed of support for al Qaeda -- and Baiji oil refinery. The memo was marked "secret and urgent". "Four days ago a sabotage bomb attack caused damage to the strategic pipeline near Shirqat," Monday's memo read. "Works are continuing to repair the damage. It's hard to determine when the flow will resume. It is expected the repair work will be finished in three to five days." It was the second disruption to the flow through the Kirkuk pipeline in less than a month after a bomb attack near Mosul in late October stopped Iraq from pumping crude to Turkey's Ceyhan port until Nov. 2. Attacks on Iraq's oil infrastructure have become less frequent in the last year as violence in the country declined. The Kirkuk pipeline typically carries 500,000 barrels of oil per day. (Reporting by Ahmed Rasheed; Writing by Michael Christie; Editing by William Hardy)
Iraq Iran Petroleum balance Both Iran and Saudi Arabia are experiencing a natural decline in their ageing oil fields. Saudi Arabia has pretty much found and exploited must of its oil reserves while Iran is having managerial/technical difficulties due to sanctions. It will take about 7 years to fully develop Iraq's oil production. Political violence will most probably extend this period. Iraq production increases will replace Iran and Saudi production short falls in the long term. This will definitely have an impact on the regional geostrategic position of both Iran and Saudi Arabia.
Iran occupies two more Iraqi oil wells - True? Iran occupies two more Iraqi oil wells December 23rd, 2009 Despite the shy con*dem*na*tion, and the demon*stra*tions orches*trated by the embar*rassed Shi*ite par*ties, Al-Sharqiya reported that Iran invaded two more oil wells in Fakka (well-11, well-13) area, the satel*lite TV sta*tion broad*cast exclu*sive images and video [win*dows media player] show Iran’s mil*i*tary forces build sand bar*ri*ers sur*round*ing the Fakka oil well, the video also shows Iran*ian flags raised on the well. MPs in the par*lia*ment say that Iran*ian intel*li*gence ser*vices are try*ing to dis*rupt the par*lia*men*tary ses*sion to dis*cuss the Fakka oil well cri*sis, accus*ing the Iraqi gov*ern*ment of deceiv*ing the Iraqi pub*lic say*ing that the prob*lem has been solved. Al-Sharqiya also added that a new mili*tia called “Assad Allah” = “Lion of God” formed by the Mis*san and Basra tribes wants to lib*er*ate the oil well. Another mili*tia called “South Brigade” in Basra unknown before, warned the con*sulate in Basra to with*raw from Fakka.
Russian companies sign oil contracts for Iraqi oil On Christmas Eve, the oil arm of Russian energy giant, Gazprom Neft, initialed a contract with the Iraqi government to develop the Badra oilfield in the south of the country. On December 29, Russia's second-largest crude producer by output, LUKoil, will sign a framework agreement with the Iraqi Oil Ministry on the development of Iraq's largest oilfield, West Qurna 2. Badra, in eastern Iraq near the Iranian border, has reserves of 109 million barrels (bbl) of oil. West Qurna is believed to hold 11-15 billion bbl of recoverable reserves and have a production potential of 0.8-1.0 million barrels per day (bpd). Russian companies invested huge funds in Iraq in the late 1990s, and the auctions the Iraqi government has recently held show that the United States and Britain have not taken over all of its oil reserves, as some experts thought they would. The oil situation in any country, but especially in Iraq, always has geopolitical and geo-economic sides to it. If not for this, the outcome of the December round of oil auctions in Iraq (the first one was held in November) would have been a sensation. Unfortunately, each barrel of Iraqi oil, even if not produced yet, includes many negative elements, especially for oil producers. The OPEC countries are dismayed at Iraq's oil revival, and even the oil companies that have gained access to its hydrocarbons reserves are not entirely happy. The only exception is China, which is not interested in the amount of oil it can produce in Iraq but is happy that is has gained access to the Iraqi oil and hopes that it will get it cheaper. Iraq's prospected reserves have been estimated at 118-120 billion barrels (bbl) and are the third largest in the region after Saudi Arabia and Iran. According to the U.S. Department of Energy, Iraq's total oil reserves may be 300-400 billion bbl with production costing $1 per bbl. The Americans have calculated that if the average OPEC oil price, which was $71.30 per bbl in late December, falls to $5, Iraq will still benefit from oil production. Iraq plans to increase oil production from 2.5 billion barrels per day (bpd) now to 12-13 billion bpd within six years. This would propel Iraq from 13th to 4th place on the global list of crude producers, after Saudi Arabia, Russia and the United States. OPEC is seriously worried by this possibility, while Russia fears it could provoke a stable global depression of oil prices even despite China's rapidly growing oil needs. Russian oil companies waited more than 12 years to gain access to West Qurna. LUKoil and Zarubezhneft agreed with Iraqi authorities to develop the oilfield back in 1997. But the international community's suspicion that Saddam Hussein had weapons of mass destruction eventually led to an embargo on Iraqi oil exports. The Russian companies stopped operation in Iraq, which terminated the agreement in 2002 on the grounds that the Russian consortium failed to comply with its provisions. In 2003, the United States invaded Iraq and subsequently established a "democratic" regime there that had no time or patience for the contracts signed during Hussein's rule. In other words, the return of a Russian company to the West Qurna project can be seen as partial restoration of justice. The proven reserves of West Qurna's second phase have been estimated at 12.9 billion bbl. The reserves of the first phase, which is being developed by an American-British consortium of Exxon and Shell, are 8.7 billion bbl. LUKoil has teamed up with Norway's StatoilHydro in an 85%-15% consortium and pledged to increase output at West Qurna to 1.8 million bpd for a fee of $1.15 a barrel. Gazprom Neft will hold 40% in the Badra consortium alongside Turkish TPAO (10%), South Korea's Kogas (30%) and Malaysia's Petronas (25%). Exxon, the only U.S. oil major to attend the recent Iraqi auctions, failed to get what it wanted. The British and American media even wrote that the U.S., which has spent over $1 trillion on the Iraq war, has been duped. However, American companies most likely did not bid for Iraqi oil for pragmatic reasons, strategic considerations and plans of an "oil occupation." All of the auctioned oilfields are located in southern Iraq populated by Shiites. No foreign company has bid for oilfields in central Iraq where the fields are small and the situation is unstable. The southern Shiite regions are very anti-American. The United States most likely knows that when it starts withdrawing its troops from Iraq the situation in its southern regions will not be favorable for the U.S. oil presence. This is why the United States has quietly signed agreements with the authorities of the Iraqi Kurdistan, which borders Iran to the east, Turkey to the north and Syria to the west and is said to contain a third of Iraqi oil reserves. Kurds have pinned their hopes of independence or broad autonomy on the United States, and will therefore give U.S. oil majors a free hand in their territory. The opinions expressed in this article are the author's and do not necessarily represent those of RIA Novosti. MOSCOW. (RIA Novosti political commentator Andrei Fedyashin)
Oil game continuing - Markets starting to think about Iran oil strikes NEW YORK (Dow Jones)--Crude futures ended at a five-week high Monday as separate situations involving Russia and Iran, both large oil producers, stoked otherwise light holiday trading. Light, sweet crude for February delivery settled 72 cents, or 0.9%, higher at $78.77 a barrel on the New York Mercantile Exchange, the highest settlement since Nov. 19. Brent crude on the ICE futures exchange settled $1.01, or 1.3%, higher at $77.32 a barrel. At least eight were dead after clashes between Iranian security forces and antigovernment protesters in the worst violence since the crackdown on opposition rallies following a disputed presidential election in June. Russia added to growing geopolitical fears Monday when it warned that it is prepared to cut off oil supplies to Europe via the Druzhba pipeline over a dispute with Ukraine over transit fees. Slovakia, the Czech Republic and Hungary, the three countries that would be most affected, each say they have enough oil to meet at least three months of domestic demand. Russia's threats to European energy supplies have become an annual affair, with halts to oil shipments in 2007 and 2008 having little lasting impact on the crude futures market. And while Iran is a major oil exporter, the fighting is concentrated in cities far from the main production region and so far hasn't threatened the regime. But since the two situations have enough potential to flare up, some investors are wary of opening new bets on falling oil prices, known as short positions. "It's very dangerous to be short into the new year with these issues," said Phil Flynn, an analyst with PFGBest in Chicago. With shorts out of the market and volume at its usual holiday season lows, the path is clear for investors seeking quick--and likely temporary--profits from higher prices, said Jim Ritterbusch, president of the trading advisory firm Ritterbusch & Associates in Galena, Ill. "When we're getting into this holiday period...you can find any geopolitical item out there and use it as a reason for oil going up," Ritterbusch said. "But it's more of an excuse than a reason." Ritterbusch said struggling global oil demand and ample supplies remain as much of an issue with oil at nearly $80 a barrel as they were when prices plunged below $70 a barrel earlier in December. The market is pricing in some relief on the supply front, however. Analysts surveyed by Dow Jones gave an average forecast for a 1.1 million-barrel drop in U.S. oil inventories, as well as a decline of 1.8 million barrels in distillate stocks, including heating oil and diesel. Gasoline inventories are expected to rise by 500,000 barrels as refinery utilization inches 0.1 percentage point higher to 80.1% of capacity. U.S. oil inventories have fallen for three consecutive weeks, though some of that crude may have been moved into offshore storage to avoid an end-of-year tax charge. Government data are due out on Wednesday. Front-month January reformulated gasoline blendstock, or RBOB, settled 2.88 cents, or 1.5%, higher at $2.0184 a gallon. January heating oil settled 3.79 cents, or 1.9%, higher at $2.0735 a gallon.
Oil minister admits low foreign oil investment in Iranian year ending March Have not managed to even attract $20 Billion in oil and gas investment this year. اعتراف وزیر نفت رژیم به ناکامی در امضای قراردادهای نفتی خبرآنلاین: اعتراف وزیر نفت به ناکامی در امضای قراردادهای نفتی و گازی در سالجاری وزیر نفت امروز در جمع خبرنگاران در پاسخ به آخرین وضعیت جذب منابع سرمایه ای و مالی داخلی و خارجی در سطح صنعت نفت از ناکامی های مسوولان نفتی در جهت جذب سرمایه داخلی و خارجی در سالجاری خبرداد. براساس اظهارات کاظمی ، حتی در این مدت به اندازه 20 میلیارد دلار قراردادهای جدید نفت و گاز در سطح صنعت نفت منعقد نشده است.
Oil Industry workers may immigrate from Iran Iran Deputy Oil minister advises that Iranian oil specialists are underpaid and receive lowest wages in the world. This may lead them to immigrate elsewhere because world HR prices in oil industries are uniform throughout the world. احتمال مهاجرت کارکنان صنعت نفت به خارج از کشور خبرگزاری مهر: معاون وزیر نفت یکی از مهمترین چالشهای پیش روی توسعه صنعت نفت را بررسی وضعیت حقوقی و دریافت کارکنان صنعت نفت عنوان کرد و افزود: در حال حاضر صنعت نفت در دنیا یک بازار رقابتی بوده که باید با بازارهای مختلف دنیا رقابت کند و نرخ نیروی کار در این صنعت در تمامی بازارهای دنیا مشخص شده است. جشن ساز با اشاره به اینکه اگر بازارهای خلیج فارس، دریای شمال، اروپای غربی و آمریکا را از نظر میزان دریافت حقوق کارکنان مورد بررسی قرار دهیم تبیین کرد: در هر یک از این بازارها یک تعریف مشخص از میزان حقوق و دریافتی کارکنان وجود دارد که هم اکنون میزان دریافت حقوق کارکنان صنعت نفت ایران از تمامی این بازارها کمتر است. وی با اشاره به اینکه هم اکنون ما در سطح صنعت نفت مدیریت و بهره برداری 20 حلقه چاه را به یک مهندس متخصص واگذار می کنیم متوسط ارزش مادی این چاهها حدود 200 میلیون دلار است، ادامه داد: اما حقوقی که ماهیانه به این مهندس تعلق می گیرد صدها برابر کمتر از ارزش کاری است که انجام می دهد. جشن ساز در پایان خاطر نشان کرد: اگر وضعیت نظام حقوقی و دریافت کارکنان صنعت نفت به همین روال موجود ادامه یابد احتمال خروج برخی از این کارکنان به خارج از کشور وجود دارد.
Major Iran Oil industry events in last week A) Parliament passes an exceptional 2500 Milliard Rial funding for Oil Industry. This money is for Human resource expenditures and resolving some issues. B) Oil minister admits low FDI for Iran oil & gas indistry. C) Deputy Oil minister advises Iranian Oil experts are underpaid and may immigrate. It seems as though Iran Oil industry is facing a lot of issues. These messages seem to be foreshadowing production decline in Iran oil production due technical reasons. Has the populations discontent spread to disruption of Oil production? Seems to be the case when looking at above.
Foreign investment in the oil and gas sector could surpass that level, should we agre TEHRAN, Jan. 19 (UPI) -- Foreign companies have proposed roughly $20 billion in investments in the Iranian oil and gas sector, the Iranian oil minister said. Seems everybody is in line for FDI but Iran government does not agree to conditions Iran holds some of the largest oil and gas deposits in the world. U.S.-backed economic sanctions meant to discourage foreign investors from doing business in Iran, however, have scared many investors away. Tehran in November said it needed $40 billion to help develop the South Pars gas field, the largest gas complex in the world. In December, meanwhile, energy officials said they needed to bring in $85 billion to keep natural resource exports at their current levels for the next 10 years. Masoud Mir Kazemi, the Iranian energy minister, said foreign investors have come forward with around $20 billion for the Iranian energy sector, Iran's Press TV reports. "Foreign investment in the oil and gas sector could surpass that level, should we agree with interested companies," he said.
PR to divert Petroleum sanctions Iran looks for fuel export markets Published: Jan. 19, 2010 at 11:40 AM TEHRAN, Jan. 19 (UPI) -- Iran aims to export fuel reserves to its neighbors, riding on the success of the 400,000 tons of diesel sent to Iraq in the past nine months, officials said. Farid Ameri, the managing director at the National Iranian Oil Products Distribution Co., said apart from diesel, his country exported 90,000 tons of kerosene and 6,000 tons of jet fuel to Iraq since the start of the Iranian calendar year on March 21, 2009. He added the government in Tehran is exploring a similar relationship with Pakistan and Armenia, Iran's state-backed broadcaster Press TV reports. Petrol stations were mentioned in January for the border with Afghanistan to counter the impact of cross-border smuggling. Iran has energy transit networks established with several of its neighbors, including Azerbaijan and Armenia. Tehran is keen to move ahead with the long-delayed pipeline from the South Pars gas field in the Persian Gulf to Pakistani and Indian markets, though that project suffers from lingering diplomatic concerns. Iran sits on some of the largest oil and gas deposits in the world but struggles to find a suitable market because of crippling economic sanctions.
Iran denounces US Senate's approval of gasoline sanctions Jan 29, 2010 Eric Watkins OGJ Oil Diplomacy Editor LOS ANGELES, Jan. 29 -- Iran has condemned the US Senate for approving gasoline import sanctions against the Middle Eastern country, saying it follows Washington’s traditional line of ineffective policy-making. “We have repeatedly announced that the sanctions the US has imposed against our people over the past 31 years…have had no result but solidifying the resolve and intention of our nation to seek independence and self-sufficiency and attain highest levels of sophisticated technology,” said Iranian Foreign Ministry spokesman Ramin Mehmanparast. “We have always announced that the war-mongering and military build-up policies of the unilateralist countries under the pretext of solving regional crisis are wrong as their failure has repeatedly been emphasized,” Ramin said. Iran’s criticism came after the US Senate voted to strengthen existing sanctions against Iran and impose new ones which target its gasoline supplies as part of Washington’s effort to dissuade Tehran from pursuing nuclear weapons and cracking down on internal dissent. “We have all watched the Iranian regime oppress its own people on the streets of Iran and continue to defy the international community on nuclear issues,” said Democratic Senate Majority Leader Harry Reid (Nev.). “That is why it is so important that we move this legislation forward quickly.” Gasoline prices rising This week’s Senate measure coincided with reports that Middle East gasoline prices rose this week due to slightly higher demand in the region—especially from Iran, one of the region’s main consumer markets. “What we are seeing is that demand has been picking up as Iran starts its stockbuild exercise in anticipation of stricter sanctions from the US,” said one Asian-based trader. Earlier this month, traders said Iran’s January gasoline imports were expected to rise by 23% over December, as the Islamic republic continued to build stocks as the threat of stricter sanctions loomed. They said Tehran was likely to import as much as 128,000 b/d of gasoline from the international spot market or about 15 cargoes. The increase amounted to 25,000 b/d over the 103,609 b/d of gasoline Iran imported in December. “There was a flurry of activities towards the end of the month. It looks like they are now building inventories,” said one Middle East-based trader at the time. That build-up came after the US House of Representatives passed legislation in December authorizing President Barack Obama to levy sanctions on companies that directly provide gasoline to Iran, along with firms that provide insurance and tankers to facilitate fuel shipments (OGJ Online, Dec. 16, 2009). At that time, reports said Iran was already storing about 1.45 million bbl of gasoline on tankers as it slowly built inventories in anticipation of the tougher sanctions regime. Traders said the fuel was being stored on at least six oil tankers anchored in Iranian waters, a build-up which had been steadily taking place since September, traders said. “They are definitely in a bit of a bind, they want to build inventories but at the same time they are struggling to find the money to buy surplus product,” a trader said.
Production Iran is OPEC’s second-largest producer after Saudi Arabia. In 2008, Iran produced approximately 4.2 million barrels of oil per day (bbl/d) of total liquids, of which roughly 3.9 million bbl/d was crude oil, equal to about 5 percent of global production. For most of 2009, it is estimated that Iran’s crude production was approximately 3.8 million bbl/d, almost 500,000 bbl/d above Iran’s estimated 3.3 million bbl/d OPEC quota. Iran’s 2009 crude oil production capacity is estimated to be 3.9 million bbl/d. OPEC Crude Oil Production 2009 Iran produced over 5 million bbl/d of oil in 1978, but since the 1979 revolution a combination of war, limited investment, sanctions, and a high rate of natural decline in Iran’s mature oil fields have prevented a return to such production levels. Iran’s fields have a natural annual decline rate estimated at 8 percent onshore and 11 percent offshore, with recovery rates at 20-25 percent. An estimated 400,000-700,000 bbl/d of crude production is lost annually due to declines in the mature oil fields. To offset natural decline rates, Iran’s oil fields require structural upgrades including enhanced oil recovery efforts such as natural gas injection.
Who will devlop newly discovered fields? 02/07/2009 Iran's oil minister announced on Saturday the discoveries of an oil field and a gas field, estimating the total value of their reserves at $85 billion, a semi-official news agency reported. Massoud Mirkazemi said the newly-discovered oil field called Soumar was located in the western Kermanshah province. "This new oil field has reserves of 475 million barrels of oil, of which 70 million barrels are recoverable," he was quoted as saying by Mehr News Agency. "If we value the recoverable oil at $70 dollars a barrel, the estimated value of the newly-discovered oil at this field would be $5 billion," he said. The gas field called Halgan was located about 70 km north of the Gulf port of Assaluyeh, he said, adding its daily output could reach some 50 million cubic metres over a two-decade period. "If we reckon the value of every cubic metre of gas at around 30 US cents, the value of the discovered gas in this field will be around $80 billion," he said, without saying when production might start. Iran is the world's fifth-largest oil exporter. It also sits on the world's second-largest natural gas reserves after Russia. But US and UN sanctions hampering access to new technology have slowed its development as a major gas exporter.
Cheap gas for Dubai to mark 22 Bahman! What an achievement after 31 years Iran to launch Salman gas field on Feb. 11 TEHRAN - Iran will inaugurate its offshore Salman gas field on Feb. 11 and it will start with a daily output of up to 540 million cubic feet, the ISNA news agency reported. "The Salman gas field project ... for the production of 500-540 million cubic feet, will be commissioned on (Feb. 11)," ISNA quoted Seifollah Jashnsaz, managing director of the National Iranian Oil Company, as saying. Iran marks the 31st anniversary of the Islamic revolution on Feb. 11. The Salman field should have started pumping the Islamic Republic's first gas exports to the United Arab Emirates in late 2005. In November, Iranian parliamentarians said Tehran may revoke the deal to export gas to the UAE because of a dispute over pricing. UAE-based Crescent Petroleum said in July it was seeking international arbitration for the failure of Iran's state oil firm to fulfil the contract.
Speaks for itself 31 years of economic mismanagement and embezzlement of Iran's Resources. No investment, massive economic subsidies, and a very expensive security appartus to maintain status quo. This is a road to hell. I hope the Iranian people will manage to unleash their chains and find a true path on February 11th 2010
Low oil prices: A tool to control Iran NEW YORK (CNNMoney.com) -- A desire to bring Iran to the bargaining table over its nuclear program could keep oil prices low worldwide for the next several months. Some analysts say Saudi Arabia, which has taken millions of barrels a day off world oil markets in response to falling demand, may open the taps if oil prices get too high. The Saudi's don't want high oil prices to hurt any global economic rebound. But they also don't want Iran, a rival in the region that has a nuclear program many say is designed to make weapons, to benefit from high oil prices. "They are seeking to maintain financial pressure on Iran as the U.S. seeks to build support for additional sanctions over the nuclear issue," Greg Priddy, a global energy analyst at the Eurasia group, a political risk consultancy, said in a recent research note. Lower oil prices could certainly hurt Iran. The country is the world's fourth-largest oil exporter, getting most of its revenue from oil sales, and needs prices near $100 a barrel to adequately sustain its government spending. Crude in the $70 range is thought to be enough to sustain Saudi Arabia's government spending, but not high enough for Iran. With oil prices near $70 a barrel and with its political instability, some believe it may be more willing to enter discussions about its nuclear program. Some say lower oil prices are already having an effect, contributing to the protests in the country and the government's harsh response. "[The regime] has to shoot their own kids," said Fariborc Ghadar, a senior adviser at the Center for Strategic and International Studies and a professor of global business strategy at Penn State about the recent political upheaval in the country. "Women in the cities are angry. The economy is in terrible shape. The place is a mess." Of course it's not just lower oil prices that's driving the turmoil in Iran, but they are helping. Also helping are more targeted sanctions against investments in the country's oil infrastructure and decisions by U.S. allies to go after Iran's oil export market, said Ghadar. For example, a new refinery in China is being built by the Chinese state oil company, Exxon Mobil, and Saudi Aramco. By enlisting the Saudi's cooperation on the project, it ensures the refinery will be supplied with Saudi oil, not Iranian. The Iranians then have to go out and find someone else to buy their oil. "Third country markets may not be as economically attractive," said Ghadar. "It's causing a major burden on them." Now, whether these problems would be enough to convince the Iranian regime to give up its nuclear program is another matter. "That's a very complicated decision tree for the Iranian government," said Sharon Squassoni, a colleague of Ghadar's at CSIS and an expert on proliferation issues. "It might put on some pressure, but is it pressure enough? My guess is no." Although Squassoni acknowledged what's been tried to date hasn't really worked either. "In seven years, we haven't figured out what the right amount of pressure is." Saudi will power The real question is, when oil prices do begin to go up, will the Saudi's long term interests and strategic concerns outweigh the immediate gains that could be made in their pocketbook? One analyst who has connections inside OPEC thinks not. "Saudi Arabia would like to make as much money as it can on oil, this is the most important thing to the Kingdom," said the analyst, who asked not to be identified. "Their love of money will supercede their interest in security." Analysts that specialize in oil prices are generally split when it comes to the direction of crude prices in 2010. But those that think they're going up, like Merrill Lynch's Francisco Blanch, also don't believe Saudi Arabia will open the taps anytime soon. "We've already seen oil prices at $83," said Blanch, "and there wasn't much of a reaction from the Saudis". To top of page
Hamedan Petrochemical Complex closed Construction of Hamdean Petrochemical started 6 years ago and was initiated through government and private sector support. Operations were planned to start this year but this was cancelled after an 85% completion of construction. The plant has been closed because the companies owes USD 40000 to the Social ministry. The Chairman mentions that the main problem of the company is a lack of a definite board of directors. He mentions that managing director of the company was dismissed 5 years ago and still claims to be its managing director. The employees of the company have not received any wages in the last months and hav had to endure many hardships. You can find info on company at Hegmataneh Industries Petrochemical Co. "Innovation is the mysterious of the Sustainable Development" is the company motto in their homepage. It is no wonder why petrochemical complex is broke. English skills seem to be non existant. Somebody pocketed a lot of loans in this project and drove it to the wall. This clearly shows that Iranian private sector lacks investment interest. So Iran is definitely facing great difficulty raising domestic and foreign capital and having to shutdown important projects.
Two Important oil companies close to closure Engineering companies Namuran and Saze are currently dismissing 550 workers due to heavy losses. This is occuring due to bad government policies and a lack of both international and domestic investment. Oil projects are now being given to newly established government linked companies and these 2 long established companies are moving towards bancruptcy because they are not being paid for previous government works. The companies are now facing the consequences and have advised their workers about the possibility of redundancies
China oil buys from Saudi, Iran drop; Libya, Angola up By Chen Aizhu BEIJING (Reuters) - China imported less crude oil from Saudi Arabia and Iran in January from a year earlier, but raised purchases from African exporters such as Angola and Libya and smaller MidEast producers Kuwait and Iraq, customs data showed. But traders familiar with Saudi and Iranian supplies to China said the data could be skewed due to the Lunar New Year holiday and warned against interpreting them as evidence of weakening Chinese demand. Top exporter Saudi Arabia shipped in 2.91 million tonnes, or 685,000 barrels per day (bpd) last month, a level 7 percent lower than January 2009 but tumbled nearly 500,000 bpd from December's peak at about 1.18 million bpd, customs said. "If you average out the December and January numbers, then it's closer to a real monthly volume which is about 900,000 bpd for the Saudi exports," said one trader close to state-run Saudi Aramco. Imports from Iran almost halved from a year earlier and were a quarter below December at 256,000 bpd, the data showed, in a month that total Chinese crude oil imports rose a third to 4.03 million bpd. "It's possibly due to port congestions before the holiday. From what we can see supplies from Iran have not gone up, but neither down. February volume could head up again," said a second trader familiar with Iranian oil supplies. However, China, the world's No.2 crude buyer after the United States, raised imports from Angola which overtook Saudi Arabia as the top exporter with a 53 percent rise in supplies last month.
