Iran officially expels CNPC from oil project
Tehran, Iran, April 29
By Milad Fashtami - Trend:
Iranian Oil Minister Bijan Namdar Zanganeh ordered the ministry officials to officially expel China National Petroleum Corporation (CNPC) from South Azadegan oilfield's development project.
The oil minister had previously issued a 90 day ultimatum to the Chinese firm, Iran's IRNA News Agency reported on April 29.
On Feb. 18, Iran issued an ultimatum to CNPC over its continuous delays in developing the South Azadegan oilfield.
At the time, Zanganeh said, "If this trend continues, we will expel CNPC from the project."
"The presence of CNPC in Iran will depend on changing its behavior within the 90-day ultimatum which has been given," Zanganeh said.
On April 19, Iran's Tasnim reported that CNPC is on the verge of quitting Iran's South Azadegan oilfield development project.
CNPC had been awarded with developing North Pars oilfield, Yadavaran joint oilfield, North and South Azadegan fields, and the Phase 11 of the South Pars gas field. Due to its repeated delays, the company has been expelled from the South Pars and the North Pars projects, and they are on the verge of being expelled from the South Azadegan project.
CNPC has been in charge of developing the field for seven years. However, only seven out of the projected 185 wells of the first phase of the oilfield have been drilled so far, the managing director of Iran's Petroleum Engineering and Development Company (PEDEC), Abdolreza Haji Hosseinnejad said in February.
"The project is only 7 percent complete," he noted.
"CNPC was supposed to use 25 drilling rigs at the joint oilfield, but currently only five drilling rigs are active there," he continued.
The oilfield is projected to produce 320,000 barrels of oil per day.
In 2009, CNPC signed a memorandum of understanding with National Iranian Oil Co, promising to pay 90 percent of development costs for the South Azadegan oil field while taking ownership of a 70 percent stake. An Iranian official said the project needed investment of up to $2.5 billion, Reuters reported.
Edited by C.N.