Iran needs EU’s modern oil technology (Exclusive)

Baku, Azerbaijan, July 18

By Dalga Khatinoglu, Trend:

Iran has defined $200 billion worth of projects in up/mid/downstream oil and gas sector. They will partly be carried out by foreign companies.

However, Iranian government says the share of local companies in the projects would be high, especially, in upstream projects, where each foreign company must choose a local partner and transfer the modern technology and investment into the projects.

Saeed Ahangaran, secretary of the Society of Iranian Petroleum Industry Equipment Manufacturers (SIPIEM) told Trend that currently Iranian local companies have capacity to take some 70-percent share in downstream and 50-percent in upstream projects, in case modern technology is transferred into the country.

Recently, Iran signed a 20-year contract with a consortium, headed by French Total, to develop South Pars gas field’s 11th phase, projected to cost $4.8 billion.

Total has a 50.1-percent share, while Chinese CNPC and local Petro Pars have each 30 percent and 19.9 percent stakes respectively.

According to newly designed oil contracts, called Iran Petroleum Contract (IPC), foreign companies should select a local company, bring investment and transfer technology to the projects, while the project operatorship would be changed between partners periodically.

The ownership of all investments and technology, brought by foreign companies and shared with Iranian oil companies, belong to National Iranian Oil Company.

Iran has introduced 49 upstream oil and gas projects for foreign companies to take part in.

Ahangaran said that about 70 percent of the needed equipment for refineries can be built domestically, but it depends on the government policy and usage of domestic might as well as technology transfer from abroad.

“Iranian companies can participate massively in piping or drilling operations, including construction of on/offshore rigs,” he said.

Recently, Iran said that about $25-30 billion worth of investment is needed for construction of 20,000-ton platforms and mega compressors in South Pars phases to prevent production fall after 2023, when the field reaches dew point and faces pressure decrease.

Iran currently uses ordinary 1500-ton platforms there, and Oil Minister Bijan Zanganeh announced recently that neither Iran nor regional countries possesses the needed technology for construction of 20,000-ton platforms.

However, Ahangaran said that local companies can participate partly as contractors in these projects as well.

The first mega platform with $2.5 billion worth would be constructed in 60 months by Total-led consortium for South Pars phase 11.

He added that currently Iranian companies are negotiating with French, Italian, German, Norwegian and Dutch companies on modern technology transferring into the country.

“The negotiations are focused from a range of issues including wellhead and well-in equipment, corrosion-resistant alloy (CRA) pipelines production, other type of especial pipelines, progressive pumps, compressors, etc,” he added.

Recently, Iran signed an agreement with Spanish Tubacex to produce CRA pipelines.

NIOC signed a $630 million deal for a 50-50 joint venture between Mobarakeh Steel Company and Tubacex on May 24 to purchase 600 km CRA pipes, needed for the giant South Pars project.

Iran’s MAPNA also has signed deals with Europeans, especially Siemens for manufacturing turbo compressors.

Ahangaran said that there are great hopes for taking extra share by local companies in the oil and gas projects with getting western technology and investments.


Dalga Khatinoglu is the head of Trend Agency’s Iran news service, follow him on Twitter: @dalgakhatinoglu

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