Iran takes step closer to exporting LNG to international markets
Baku, Azerbaijan, April 23
By Farhad Daneshvar – Trend:
Iranian ministries of oil and defense inked an agreement on Monday that will contribute to realizing an ambitious project to export liquefied natural gas (LNG) to international markets through Oman.
Under the agreement inked by Defense Minister Amir Hatami and Oil Minister Bijan Namdar Zanganeh, the sides will cooperate in extending the country’s gas pipeline into the port city of Chabahar in the southeastern province of Sistan and Balouchestan, oil news agency SHANA reported.
The contract has envisaged extending a 56-inch branch from the seventh cross-country gas pipeline from the city of Iranshahr into Chabahar.
In addition to delivering gas to Chabahar, the 200-kilometer pipeline is expected to pave the ground for exporting Iran’s gas to Oman. The project is expected to cost about 245 million euro (two trillion tomans) and be completed within three years.
Iran in December 2017 announced that it had inked a deal with Oman that would end in jointly exporting LNG to international markets.
Oil Minister Bijan Zanganeh in December said that he had signed the agreement with Oman’s Oil Minister Mohammed bin Hamad al-Rumhi on the sidelines of a meeting of the Organization of the Petroleum Exporting Countries (OPEC).
Iran has earlier held several rounds of discussions with Oman to produce LNG in its Qalhat liquefaction plant. The project involves supplying gas from southern Iran to the Persian Gulf sultanate and liquefying it into LNG for shipments to international markets.
Iranian media earlier said that international giants including Total and Shell had expressed interest in the project, by establishing a subsea pipeline between the two countries.
The differences on the route of the pipeline and the pricing formula are said to be among the main obstacles to the project’s progress. The marine section between Iran and Oman’s Sohar Port is estimated to be 200 kilometers.
Elaborating on the plan to export gas to Oman Oil Minister Zanganeh on April 23 said that the sides are expected to announce a tender for the construction of the sea-bed pipeline.
“The negotiations have advanced and we are in a phase for announcing a tender for the construction of the sea-bed pipeline. We are getting close to finalize an agreement under which a foreign company will invest in the construction of the pipeline," he said.