“Rahbord Energy“: Ultimately, after struggling on multiple version drafts and controversial corrections on Iranian new oil contracts, the first Iranian Petroleum Contract (IPC) deal in post sanction era in framework of Joint Venture was signed among Total, China National Petroleum Corporation (CNPC) and Petropars to develop phase 11 in South Pars offshore field on 2nd of July 2017. The value of this project is $4.8 billion and is based on the technical, contractual and commercial terms.
Total is the operator of the project and it will take a 50.1 percent stake of this joint venture, while CNPC will own 30 percent and Iran’s Petropars is 19.9 percent. The project will have a production capacity of 2 billion cubic feet per day and the aim is to start pumping into Iran’s domestic grid in 2021.
This contract had massive reflection in regional and world’s media, economic and political circles. It will pave the way for foreign companies to bring their investment and technology into Iran. Patrick Pouyanné, Chairman & CEO of Total said “This project is in line with the Group’s strategy to expand its presence in the Middle East and grow its gas portfolio by adding low cost, long plateau assets.”
Undoubtedly, Political opposition from hardline conservative politicians to foreign investment had repeatedly delayed the release of the much-anticipated revised model IPC for IOCs and Iran’s Oil Industry Revival. Although, Total CEO has stated that will develop the project in strict compliance with applicable national and international laws, but it should be noticed whereas JCPOA is respected by Iran and its partners, it is impossible there will be a consensus on Iranian oil sanctions in the UN Security Council.
Iran’s oil and gas sector Contributes about 25% of its budget, while remains a major source for revenue and Iran has made rapid gains, boosting crude exports to 2.3 MMbpd from 1.3 MMbpd a year in sanction era, returning market share lost and providing valuable additional revenues at a time of slumped oil prices and extension of OPEC OPEC’s output cut plan.
Iran’s petroleum production is 3.5 MMbpd and the petroleum ministry plans to reach and raise oil production capacity to 4.6 MMbpd (some source say 5.7 MMbpd) by 2020 hinge on its ability to attract IOCs with advanced technologies to finance the capital intensive projects.
However, Iran is facing formidable challenges in reviving its oil industry, the harnessing of knowledge to develop enhanced oil recovery (EOR) methods in partnership with outside parties should be addressed in IPC era. Substitution of exhausted facilities with modern ones, recruitment of young & specialized risky directors and exploiting of oil educational-research centers must set forth at the coming cabinet petroleum ministry.
Whereas, Iran has the world’s first-largest natural gas reserves and the fourth-largest oil reserves, through updating its human resources’ knowledge and expertise, could yield its 2025 goals prospect and could be a key energy actor in the coming decades.
