Shell, Repsol present new proposal for South Pars project

Iran Materials 10 June 2009 11:33 (UTC +04:00)

TEHRAN (MEHR - Trend )

Royal Dutch Shell and Repsol have offered a new proposal for the initial production of Iran's South Pars gas field's phases 13 and 14, Oil Minister Gholam-Hossein Nozari said here on Tuesday.

"Total has also expressed interest in investing in the liquefied natural gas (LNG) production project of the SP Phase 11 development plan," Nozari added.

The oil minister stated that $67 billion has been invested in Iran's oil industry over the past four years and added that the country's daily crude output has increased to 4.23 million barrels.

He went on to say that seven new oil refineries have been built and the older facilities have been renovated over the four-year period with the aim of boosting the country's petrol production capacity to 190 million liters per day in the next few years.

Iran said in April that it had given Anglo/Dutch Shell and Spain's Repsol until May 20 to clarify their involvement in the project.

Last year, Shell delayed decisions on multi-billion dollar investments in Iranian LNG projects due to political tension. Repsol has made large investments in Iran, which is the world''s fourth-largest oil producer.

Repsol and Shell signed a service contract for the LNG project in January 2007, setting out the conditions for exploration and development operations in phases 13 and 14 of the South Pars project.

The Persian LNG project concerns development of production and exports of liquefied natural gas from a part of the South Pars field in the Persian Gulf. Repsol, Shell, and the National Iranian Oil Company (NIOC) signed an initial deal in 2002 to develop Phase 13 of South Pars.

It said production from those phases would feed a future LNG plant that would have two liquefaction trains, each with capacity for 8.1 million tons per year, but that a final investment decision had yet to be taken.

According to Oil and Gas Journal, Iran's 2008 estimated proven natural gas reserves stand at 948 trillion cubic feet (Tcf), second only to Russia. Roughly two-thirds of Iranian natural gas reserves are located in non-associated fields and have not been developed.

According to the NIOC Exploration Directorate, there are about 150 unexplored anticlines in Iran.

In January 2008, Nozari said that NIOC had set a target of producing one billion cubic meters of gas per day.