The theocracy in Tehran has launched a campaign to attract IOCs to
its petroleum sector. But Tehran has so far achieved limited progress as
only Asian firms have agreed to venture into an isolated country. Some
Western companies have kept showing interest in oil and gas fields which
are to be developed, but none of them has made a firm investment
commitment.
Field development projects are offered under buy-back contracts
whereby the foreign operator gets a fixed service fee. But there are
penalties if the operator's work is below a standard set by the
state-owned National Iranian Oil Co. (NIOC).
Iran's 13th international oil, gas and petrochemical
exhibition was opened on April 19 by First Vice-President Parviz Davoudi
and Oil Minister Gholam-Hossein Nozari. Davoudi said Iran's
petroleum industry required $500 bn of new investment in upstream,
midstream and downstream projects for the period to 2024. He said
foreign companies would be expected to provide a major part of this.
Minister Nozari said US and UNSC sanctions against Iran were "warn
out tools" belonging to the 1950s and 1960s and were not affecting
the country's plans to expand the petroleum sector.
However, independent experts say Iran is losing 500,000 b/d of its
crude oil production capacity every year, as a result of
under-investment and severe damages in the oilfields. Some of
Iran's major oil reservoirs are said to be damaged beyond repair.
Iran is also short of oil refining capacity, causing it to import a
major part of the country's rapidly growing gasoline requirements.
COPYRIGHT 2008 Input Solutions Reproduced with permission of the copyright holder. Further reproduction or distribution is prohibited without permission.
Copyright 2008 Gale, Cengage Learning. All rights
reserved. Gale Group is a Thomson Corporation Company.
NOTE: All illustrations and photos have been removed from this article.