Iran’s NIGC needs $6 billion investment for current projects

Oil&Gas Materials 20 November 2013 12:56 (UTC +04:00)

Baku, Azerbaijan, Nov. 20

By Rahim Zamanov - Trend:

The National Iranian Gas Company (NIGC) needs over $6 billion in the next Iranian calendar year (starts March 21, 2014) to complete ongoing development plans, the company's Managing Director Hamidreza Araqi said on Wednesday.

"NIGC may face problems at some periods of time, but bankruptcy is not an issue of concern," the SHANA News Agency quoted Araqi as saying.

Araqi, who is also the deputy oil minister, put the company's annual turnover at 300 trillion rials, about $12 billion based on the US official exchange rate of 24,900 rials.

The Mehr News Agency reported on November 16 that the National Iranian Gas Company had gone bankrupt.

NIGC has over 100 trillion rials, about $4 billion based on the U.S. official exchange rate of 24,900 rials in debt, the report added.

The NIGC managing director affirmed the company's bankruptcy, saying that the improper implementation of the subsidy reform plan has grappled with the energy-related organisations of the country with many problems.

Iran's budget bill for next year has envisioned new mechanisms for resolving the financial problems of the company. The next Iranian solar year will start on March 21, 2014.

Araqi has said the country's gas industry is facing a severe budget deficit.

On September 6, Araqi was appointed to the post of managing director of the National Iranian Gas Company replacing Javad Owji.

Iran which sits on the world's second largest natural gas reserves after Russia, has been trying to enhance its gas production by increasing foreign and domestic investment, especially in its South Pars gas field.

According to Iran's Oil Ministry, the country's proven natural gas reserves are about 1,045.7 trillion cubic feet (29.61 trillion cubic meters), or about 15.8 per cent of world's total reserves.