Baku, Azerbaijan, July 6
By Dalga Khatinoglu – Trend:
Iran says that about $12 billion would be paid to Total-led consortium in 20 years, based on recently signed $4.8 billion agreement on development a project of South Pars gas field’s phase 11.
According to the 20-year agreement, the first stage of South Pars phase 11 ($2 billion worth), would become operational in 40 months (including construction of two 1,500-ton platforms, drilling 30 wells and construction of 270-km pipeline) to produce 56 million cubic meters of gas and 80,000 barrels of gas condensate daily.
At the second stage, the consortium would launch a 20,000-ton platform with mega compressors, to maintain the production level in the phase, as the field is expected to reach dew point and lose productivity.
Iran’s Oil Minister Bijan Namdar Zanganeh told journalists on July 5 that it is expected some $84 billion worth of revenue will come in from phase 11 in 20 years, based on expected $50/barrel oil price, of which 15 percent, or $12 billion, would be paid to Total (operator) and its partners, IRNA reported July 5.
Total with 50.1 percent share is the operator of the project, while Chinese CNPC and Iran’s Petro Pars have 30 percent and 19.9 percent stakes respectively. The agreement can be extended for further 5 years.
Zanganeh said that if the agreement is to be extended, then the revenues of consortium would increase as well.
The agreement is the country’s first deal with foreign companies based on newly designed contract model, called Iran Petroleum Contract (IPC). According to IPC, the contractors would get a percentage of produced oil and gas from projects as far as the project is active (20-25 years).
Zanganeh said that in case the foreign companies abandon the projects before completion due to possible sanctions on Iran, then their investment would be paid gradually after the project becomes operational, not immediately.
Iranian minister also said that Iran is negotiating with other companies on development of several oil fields, like Yadavaran, Yaran, Azadegan, South Pars oil layer and Azar field to sign agreement based on IPC.