Can Iran translate giant oil discovery into material benefit?
BAKU, Azerbaijan, Nov.12
By Leman Zeynalova - Trend:
Limits on investment and exports due to sanctions mean that the exploration successes at Iran’s Namavaran field can’t translate into material benefit, said Will Scargill, Managing Analyst, Oil and Gas at GlobalData, a leading data and analytics company, Trend reports.
Iran’s President Hassan Rouhani announced on Nov.10 that the country has discovered a new oil field with 53 billion barrels of crude in Khuzestan province.
Iran currently has the world’s fourth-largest proven deposits of crude oil and the world’s second-largest deposits of natural gas.
The new oil field could become Iran’s second-largest field after one containing 65 billion barrels in Ahvaz. The field is 2,400 square kilometers (925 square miles), with the deposit some 80 meters (260 feet) deep.
“Limits on investment and exports due to sanctions mean that the exploration successes at the Namavaran field can’t translate into material benefit. Iran already has a large number of projects holding billions of barrels of resources that it cannot fully realize, and this just adds to that list,” he said.
Scargill went on to add that the headline figure of 53 billion barrels also masks a more modest reality.
“The government has stated that 22 billion of this is newly discovered and due to the challenging nature of the reservoir only 10 percent of the total resources are thought to be recoverable. The government will reportedly look to develop the field alongside others that lie above the newly identified reservoir. However this would likely come at the expense of production from other fields and only reach a small portion of the field’s capacity.”
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