Baku, Azerbaijan, Jan. 17
By Aygun Badalova -Trend:
Iran with the world's fourth-largest oil reserves and second-largest natural gas reserves represents a very attractive and essential player for the global energy market. However, a big export potential of the county cannot be realized due to a number of political and technical barriers.
Overcoming of these barriers will be beneficial not only for the country itself, but for the whole world, because the world now is devoid of an important energy supplier.
International sanctions enacted in 2011 and 2012 have stymied progress across Iran's energy sector, especially affecting upstream investment in both oil and natural gas projects, the Energy Administration Agency said. The U.S. and the EU, in particular, have enacted measures that have affected the Iranian energy sector more profoundly than any previously enacted sanctions. These sanctions have prompted a number of cancellations of upstream projects and have resulted in declining oil production capacity.
The lack of foreign investment and technology is affecting the county's energy sector as well.
Iran could play an important role in meeting global energy demand, Andrej Tibold, editor-in-chief at Eurasia Energy Observer believes.
"In the case of Europe, its natural gas that is most interesting. As we see an increasing decline in domestic European production, additional sources of gas would be very welcome, such as from Iran," Tibold told Trend.
Iran's proven natural gas reserves amounts to 33.6 trillion cubic meters - 18 percent of total world gas reserves. In 2012 the country produced 160.5 billion cubic meters and consumed 156.1 billion cubic meters of gas.
Iran potentially could supply its gas to the European markets via the planned Southern Gas Corridor project, which envisages the transportation of the Caspian gas to Europe, helping to diversify its energy supply sources and to increase its energy security.
The official representative of the Trans Adriatic Pipeline (TAP), which has been selected to transport Azerbaijani gas to the European markets within the Southern Gas Corridor at the initial stage, told Trend earlier that TAP will be able to transport more gas from different sources as new gas reserves come on stream. He said that "as further gas reserves come on stream in the future, TAP capacity can easily more than double (from its initial 10 bcm) and the pipeline will be able to transport other gas volumes, as and when they become available. At the same time, the source added that gas from Iran as an option is not being considered.
Nevertheless, the picture may change if the sanctions imposed on Iran are lifted.
Tibold, however believes that it would take 6-8 years at the earliest before Iranian gas reaches Europe, provided that the complex geopolitical knot around Iran is untied.
"Progress in negotiations on Iran's nuclear program is of course encouraging, but this is no guarantee that this will soon lead to Iran becoming a major gas exporter. The Russian position on Iran is quite different from those of the Western countries and could lead to a stall in the untying of this knot," Tibold said.