Status of oil and gas projects in Iran for December 2009

Oil&Gas Materials 24 December 2009 17:32 (UTC +04:00)

Azerbaijan, Baku, Dec. 24 / Trend A. Badalova /

Proven gas reserves in Iran as of Jan. 1, 2009 amounted to 29.61 trillion cubic meters, or 16 percent of the total proven world reserves. In 2008, gas production in Iran amounted to 116.3 billion cubic meters or 3.6 percent more than production in 2007. Demand for gas in Iran in 2008 amounted to 117.6 billion cubic meters or 3.8 percent more than demand in 2007.

South Pars

The large marine South Pars gas field was discovered in 1990. The deposit is located in the central part of the Persian Gulf in the territorial border of Iran and Qatar. The reserves on the Iranian part of the deposit are estimated at 14 trillion cubic meters of gas and 18 billion barrels of gas condensate. Pars Oil and Gas, a subsidiary of the Iranian National Oil Company is the operator of field development.

The development of South Pars includes 24 phases for the extraction of 820 million cubic meters of gas per day. Over the last four years, about $4.1 billion were invested in the project.

The first phase of the project to develop the field was put into operation in 2002.

In 2006, the development of the fifteenth and the sixteenth phases of the deposit began. The development project envisages the production of 50 million cubic meters of gas and 80,000 barrels of gas condensate daily. About 1 million tons of ethane and 1 million ton of liquefied gas will also be produced per year. Investments amounting to $2.79 billion are required to develop the fifteenth and the sixteenth phases.

In 2007, realization of the project to develop the seventeenth and the eighteenth phases of the deposit began. The volume of capital investments in the development of these phases must reach $2.49 billion.

In 2008, the exploitation of 6-8 phases was launched. About $1.96 billion was spent on their development.

The twelfth phase envisages the extraction in the southeastern block of South Pars on the border with Qatar. It covers an area of 150 square kilometers. The reserves hit about 1 trillion cubic meters of gas condensate. It is almost seven percent of all reserves of the deposit.

Development of the thirteenth phase of the field includes the construction of a terminal for LNG production. The contract for the construction of the terminal, signed in 2007, envisages the establishment of two lines of gas liquefaction, each with a capacity of 8.1 million tons.

Project Status

Gas and gas condensate are being extracted in 10 phases. The planned capacity of each is about 28 million cubic meters of gas per day. In the near future, wells will be drilled in the sixteenth phase of South Pars development. About 11 wells are planned to be drilled at a depth of 3,500 meters each at the sixteenth phase. Drilling will be conducted 105 kilometers from Asaluye in the area where the sea depth reaches 70 meters.

In 2012, the seventeenth and eighteenth phases of South Pars development are planned to be exploited. Today, a third part of the work on these phases was completed.

About 50 million cubic meters of gas, 80,000 barrels of gas condensate are planned to be extracted daily. About one million tons of ethane, and 1.5 million tons of liquefied gas are planned to be produced per year.

About 360 billion cubic meters of gas have been extracted since exploitation of ten project phases on development till June 2009. More than 8.1 million barrels of gas condensate was extracted during this period.



The 1,474.5-kilometer Gazi-Magomed-Actara-Bind-Biand gas pipeline connects Azerbaijan and Iran, including the territory of Azerbaijan - 296.5 kilometers. Its design capacity was 10 billion cubic meters per year. This route is a branch of the Gazakh-Astara-Iran pipeline, which was put into operation in 1971. Three compressor stations were built in Gazi-Magomed, Agdash and Gazakh. The gas transportation system is designed to pressure of 55 atmospheres. The pipe's diameter is 1,200 millimeters.

In December 2009, the State Oil Company of the Azerbaijan Republic (SOCAR) and the Iranian National Gas Export Company signed an agreement to supply Azerbaijani gas to the northern provinces of Iran in winter and the agreement on confidentiality to hold talks on a five-year contract during two weeks (with its possible extension) for the supply of Azerbaijani gas.

From early 2010 certain amounts of Azerbaijani gas will be supplied to Iran in accordance with the capacity of existing infrastructure.

Now the infrastructure allows to supply about 500 million cubic meters of gas per year. In the future, the parties intend to expand capacity by increasing the capacity of gas compressor stations. Price for gas has not been specified.

In the future, Iran plans to buy up to 5billion cubic meters of gas in Azerbaijan per year.

Iran-Turkey Gas Pipeline

The construction of the 745-kilometer gas pipeline Iran-Turkey was completed in 2001. The pipeline has the capacity to transport up to 40 million cubic meters of gas per day.

The contract signed between the countries envisaged supply of Iranian gas to Turkey to the amount of 3 billion cubic meters per year. As of early 2009 the volume of export of Iranian gas to Turkey amounted to about 15-18 million cubic meters per day.

Turkmenistan-Iran Gas Pipeline

The second branch of the Turkmenistan-Iran gas pipeline (Dovletabat-Salyr Yap) envisages the supply of natural gas from the largest gas field in eastern Turkmenistan Dovletabat to northern and north-eastern Iran. Its construction was completed Dec. 12. Supplies are scheduled for late December 2009.

Today, Turkmen gas supplies to Iran amounting to 8 billion cubic meters per year are carried out via the Korpeje-Gurtgui gas pipeline. By commissioning a new pipeline, Turkmen gas exports to Iran will increase to 14 billion cubic meters of gas per year, and up to 20 billion in the future.

Iran-Pakistan-India (Peace Pipeline)

The planned Iran-Pakistan-India gas pipeline, worth $7.4 billion, envisages transportation of Iranian gas to Asia. The estimated length of the pipeline is 2,700 kilometers. Pipeline capacity can reach 55 billion cubic meters per year. Over 60 percent can be delivered to India. The remaining volumes can be taken by Pakistan.

The construction is planned to be launched in late 2009. But its completion was scheduled for June-September 2014. Initially, Iran will export to Pakistan about 11 billion cubic meters a year. Then the volume will be doubled.

In early December, consultations about Gazprom's participation in this gas pipeline were held. The agreement to build a pipeline from Iran to Pakistani city of Navabshah was signed by the presidents of Iran and Pakistan in Tehran in mid-May. At the same time, Gazprom expressed its willingness to participate in the project as an operator and the contractor.

Pars Pipeline

Iran plans to export its gas to European markets via the planned trunk gas pipeline Pars. Gas extracted from the South Pars gas field will be transported to Europe through Turkey. The total length of the pipeline will hit 3,300 kilometers, its design capacity - 37 billion cubic meters per year. The project cost is estimated at $6 billion. The pipeline will be launched by 20