Impossible to attract foreign investment to oil, gas sectors due to current conditions in Iran - expert

Oil&Gas Materials 1 April 2023 14:20 (UTC +04:00)
Impossible to attract foreign investment to oil, gas sectors due to current conditions in Iran - expert
Elnur Baghishov
Elnur Baghishov
Read more

BAKU, Azerbaijan, April 1. It is difficult or even impossible for Iran to attract foreign investment in country's oil and gas sector under the current conditions (various economic problems, US sanctions, etc.), an Iranian expert on oil issues, Mahmoud Khaghani told ILNA, Trend reports.

“Currently, a total of $250 billion is needed for the development of Iran's oil sector, and $80 billion for the development of the country’s gas sector,” Khaghani said.

Although the Russian side promised to invest $40 billion in Iran's oil sector, due to the conflict with Ukraine, Russia's economy is not in a good condition, the expert added.

According to him, that’s why, Iran should still wait for China. But China is also more interested in investing in Iraq, Saudi Arabia, the UAE, and African countries. At present, some Chinese companies are investing in Iraq’s joint oil fields with Iran.

Meanwhile, several memorandums of understanding worth $40 billion were signed between Iranian and Russian companies in the oil and gas sector during the last Iranian year (March 21, 2022, through March 20, 2023).

On May 8, 2018, the US announced its withdrawal from the Joint Comprehensive Plan of Action (JCPOA) between Iran and the 5+1 group (Russia, China, the UK, France, the US, and Germany) and imposed new sanctions against Iran.

Over the past period, the sanctions affected Iranian oil exports, more than 700 banks, companies, and individuals. The sanctions have resulted in the freezing of Iranian assets abroad.

There are currently 74 oil and 22 gas fields in Iran. So, 37 oil fields are operating in the territory of the National Iranian South Oil Company (NISOC), 14 fields – Iranian Central Oil Fields Company (ICOFC), 5 fields – Arvandan Oil and Gas Company (AOGC), and 18 oil fields – Iranian Offshore Oil Company (IOOC).

In addition, 5 gas fields are operating in the territory of the NISOC, 13 fields – the ICOFC, 1 field – Pars Oil and Gas Company (POGC), and 3 gas fields – the IOOC.

Iran’s total hydrocarbon reserves are estimated at 1.2 trillion barrels. With available technology and equipment, Iran can extract 340 billion barrels. Thus, 30 percent of the country's hydrocarbon reserves are recoverable, while 70 percent remain underground.


Follow the author on Twitter:@BaghishovElnur