Iran eyes Oman's vacant LNG capacity for its gas towards Europe

Oil&Gas Materials 21 February 2016 17:57 (UTC +04:00)

Baku, Azerbaijan, Feb. 21

By Fatih Karimov - Trend:

Iran can use about 2.5 to 3 million tons of vacant LNG producing capacity of Oman to export its natural gas, Alireza Kameli, the managing director of the National Iranian Gas Export Company (NIGEC) said, oil ministry's Shana news agency reported Feb. 21.

The idle capacity of Oman's LNG producing units is about 2-2.5 million tons per year, Kameli said, adding Oman welcomes allocating this capacity to Iran.

Once the Iran-Oman gas pipeline is completed the idle capacity will increase to 2.5 to three million tons which can be used by Iran.

Based on an agreement signed between Tehran-Muscat in 2013 Iran will export 28 million cubic meters of gas to Oman per day via a sub-sea pipeline for 15 years.

A contract worth $60 billion was signed in 2014 for stretching the pipeline.

Earlier Kameli said that the pipeline project is under study in its marine section, adding the studies for onshore and offshore sections of the project will be finalized within 11 months.

About 30 percent of supplies transferred via the pipeline will be used to meet Oman's domestic gas demand, but most of it will be exported on behalf of Iran as LNG.

While responding to a question about the price of Iran's gas which is planned to be exported to Oman, Kameli said that the price is still to be set.

Iran will hold talks with Oman to reach agreement about the LNG tooling fees, he further said.

If the LNG tooling fees are reasonable, the gas price can be determined based on that, he explained.