Baku, Azerbaijan, Feb. 18
By Rahim Zamanov - Trend:
Iran has issued an ultimatum to Chinese CNPC Company over its continuous delays in developing Iran'sSouth Azadegan oil field, Iranian Oil Minister Bijan Namdaz Zanganeh said, Iranian Mehr News Agency reported on Feb 18.
"If this trend continues, we will expel CNPC from the project," Zanganeh explained, adding that the Chinese firm can continue its operation at the northern part of the oilfield if its performance there meets standards.
Iraq, which owns the other half the joint oilfield, started producing 175,000 barrels of oil per day at the field in September.
While Iran's production rate stands at 50,000 barrel per day, Baghdad plans to increase its production at the field up to 400,000 barrels per day in the near future.
According to the managing director of Iran's Petroleum Engineering and Development Company (PEDEC), Abdolreza Haji Hosseinnejad, CNPC has been in charge of developing the field for seven years. However, only seven out of the projected 185 wells of the first phase of the oilfield have been drilled so far.
"The project is only 7 percent complete," he said.
"CNPC was supposed to use 25 drilling rigs at the joint oilfield, but currently only five drilling rigs are active there," he continued.
The oilfield is projected to produce 320,000 barrels of oil per day.
In 2009, China National Petroleum Corp (CNPC) signed a memorandum of understanding with National Iranian Oil Co, promising to pay 90 percent of development costs for the South Azadegan oil field while taking ownership of a 70 percent stake. An Iranian official said the project needed investment of up to $2.5 billion, Reuters reported.
Earlier that year, CNPC also won a deal to develop the North Azadegan oilfield. That deal was worth $2 billion in its first phase.
Edited by C.N.