Kooshk Garden of the Petroleum Ministry hosted an international event yesterday July 3, 2017 to conclude the first gas contract ever concluded after the Joint Comprehensive Plan of Action (JCPA) in conformity with the new oil contracts scheme.
A special ceremony was organized to conclude a contract by and between the National Iranian Oil Company (NIOC) and a Consortium comprising TOTAL of France, CNPC of China and Petropars for development of Phase 11 of South Pars Gas Field. The share allocated to each members of the Consortium respectively measures 50.1%, 30% and 19.9%.
The USD 4-billion-879-million-Contract was singed by Ali Kardor, Managing Director of the National Iranian Oil Company (NIOC) as the Employer, and Patrick Pouyanne, Managing Director of TOTAL of France, as the Leader of the Consortium, Hamid Akbari, Managing Director of Petropars, and Lyu Gongxun, Managing Director of the International Branch of China’s CNPC. Included among the guests attending the ceremony were Bijan Zanghaneh, the Petroleum Minister, and the Ambassadors of France and China to Iran.
As the first and the greatest Iranian E&P company and the only company which has managed to develop Phase 11 of South Pars Gas Field, Petropars will cooperate with great partners such as TOTAL of France and China’s CNPC to this end.
Upon completion of Phase 11 of South Pars Gas Field, Iran’s output production capacity from South Pars, which is owned jointly by Qatar, will increase by 56 million cubic meters per day and this accomplishment will put an end to development of South Pars Gas Field.
Iran’s Petroleum Minister: Conclusion of the Contract for Development of Phase 11 of South Pars Gas Field Is the Outcome of National Consensus
The Petroleum Minister expressed his appreciation for the support rendered by the Revered Leader of Islamic Republic of Iran and President Rouhani and commented “Conclusion of the Contract for development of Phase 11 of South Pars Gas Field is the outcome of the national consensus.”
In the course of the ceremony which was held for conclusion of Phase 11 Contract, Bijan Zanghaneh, the Petroleum Minister, stated “Today is a very happy day for Iran’s oil industries and hopefully new horizons will emerge and Iran’s oil industries will step into a new phase.”
To conclude his comments, Bijan Zanghaneh, the Petroleum Minister, commented, “This Contract is one of the accomplishments of the Joint Comprehensive Plan of Action (JCPA) as well as the Presidential Elections which were held on May 19, 2017 (Ordibehesht 29, 1396)”.
The Petroleum Minister underlined, “This Contract is the first contract ever which is signed in conformity with the new oil contracts scheme. However, all requirements have been satisfied and all authorizations have been collected by the National Iranian Oil Company (NIOC) and the Petroleum Ministry.”
Bijan Zanghaneh commented, “According to the 6th 5-Year Development Plan, we need to make USD 200 billion of investment in our oil industries out of which USD 130 billion will be allocated to the upstream section while the remaining amount will be invested in the downstream section.”
The Petroleum Minister commented, “Of paramount significance is the transfer of technology at all levels and it is very imperative that we promote our domestic production capabilities. Hence, as of this date, we expect Petropars and other Iranian companies to make optimum use of every opportunity this Contract will create for them to upgrade and promote their capabilities.”
Managing Director of the National Iranian Oil Company: USD 80 Billion Revenues out of Phase 11 of South Pars
Managing Director of the National Iranian Oil Company commented, “Execution of the project for development of the offshore section of South Pars will collectively generate over USD 80 billion of revenues for Iran.”
In connection with the revenues to be generated upon implementation of Phase 11 Contract, Ali Kardor said, “Supposing that every barrel of crude oil will be worth USD 50, the value of the products to be produced during the Contract period will measure well over USD 23 billion to which one should add the value of the light sweet gas which will be produced during the Contract period plus the revenues to be collected upon completion of the Contract. Totally, the execution of this Contract will generate well over USD 80 billion of revenues for Iran.”
He stressed that this Contract includes the development and commissioning period and added, “In the course of 20 years, we will produce 335 billion cubic meters of sour natural gas which will turn into 290 million barrels of condensates, 14 million tons of liquefied gas, 12 million tons of ethane and 2 million tons of sulfur.”
Managing Director of the National Iranian Oil Company further added, “This Contract will be implemented in 2 phases for each of which some USD 2.4 billion of investment will be made. Upon completion of this Contract, gas production capacity from Phase 11 of South Pars will measure 2 billion cubic feet per day.”
He concluded his comments saying, “Upon completion of this Contract, a platform will be constructed to boost pressure of the offshore gas since in the years to come South Pars Gas Field will experience reduction in its production and under such conditions we will need pressure booster platforms.”
Managing Director of TOTAL: TOTAL Is Proud to Be Back in Iran
Managing Director of TOTAL commented, “TOTAL was the first international company which came to Iran in 1995 and today TOTAL is the first company to be back in Iran after the sanctions were lifted; a situation which is the source of pride for our company.”
Patrick Pouyanne went on to add, “The new oil contracts scheme has two features which convince us that they are profitable for Iran’s economy. The first feature is that this Contract is a 20-year contract which means that we will be here in Iran for 20 years and this shows that this a long-run commitment and undertaking.”
He stressed, “I can guarantee and assure you that we will be committed to your country for 20 years and even more. The second feature is that, according to this Contract, the responsibility of Leadership of the Consortium and Management of this Project is undertaken by TOTAL which is meant to optimize and maximize effective production. This is exactly what a great oil and gas company like TOTAL should materialize for all countries.”
According to Pouyanne, this project will improve Iran’s economy not only because of production of gas but also because it will contribute to development and expansion of production capabilities in Iran.”
He further stressed, “TOTAL will definitely utilize the competence and capabilities of Iranian contractors and eventually development of oil and gas will contribute to the growth of Iran’s economy.”
Pouyanne concluded his comments saying, “I have promised the Minister of Petroleum that over 50% of the goods and commodities required for Phase 11 of South Pars will be supplied and provided by Iranian companies.”
Managing Director of Petropars: TOTAL Intends to Transfer Technology to Petropars
Managing Director of Petropars said, “TOTAL of France has an independent plan for the transfer of technology to Petropars. Such transfer will be made irrespective of commitments and responsibilities TOTAL has undertaken with respect to Iranian Content and transfer of technology to Iranian companies.”
He went on to say, ”Petropars has so far managed to successfully develop Phase 11 of South Pars to produce 11 billion cubic feet of natural gas and 500,000 barrels of condensates.”
He further added, “Petropars has accepted to cooperate as the non-acting member and will accomplish its undertakings in conformity with this policy.”
Managing Director of Petropars went on to say, “Tough negotiations were held with TOTAL of France as a result of which we will be responsible for a minimum of 19.9% of the Project Management and 51% of the share of the commissioning company.”
He went on to add, “In the process of macro and basic decision-makings related to joint operations including work and budget plans and programs, confer of contracts and organization of the project, Petropars will cooperate as a non-acting partner.”
He further underscored that TOTAL will prepare and develop a separate and an independent plan exclusively for the transfer of technology and technical know-how to Petropars, a responsibility undertaken by TOTAL irrespective of TOTAL’s responsibilities related to Iranian Content and transfer of technology to Iranian companies.”
Managing Director of International Branch of CNPC of China: The Ground Is Set for Presence of Foreign Investors in Iran
Managing Director of International Branch of CNPC of China stated, “The Contract concluded for development of Phase 11 of South Pars will open a new chapter in the history of Iran’s oil industries. Further, it will be an excellent example for cooperation between the National Iranian Oil Company and international oil companies.”
Lyu Gongxun, Managing Director of the International Branch of China’s CNPC further reiterated, ”It will not take long before many investors will come to Iran to utilize and take advantage of the opportunities which will soon be created in the near future of Iran.”
He went on to say, “Since 1990s when CNPC was introduced into Iran’s oil market, we cooperated in many oil and gas projects the most successful of which was development of North Azadeghan. Relying on the support rendered by Iran’s government and the National Iranian Oil Company as well as the local communities and tribes we resolved many challenges we experienced.”
Lyu Gongxun concluded his comments saying, “We are positive and certain that relying on close cooperation and utilizing state-of-the art and advanced technologies, TOTAL, CNPCI and Petropars will manage to have the maximum production at the shortest period of time out of Phase 11 of South Pars Gas Field.”
Commissioning of Phases 17-18, Phase 19 and Phases 20-21 as well as Phase 1 of the Project for Development of Output and Production from oil layers of South Pars Gas Field was inaugurated by President Rouhani on Sunday, April 16, 2017 (Farvardin 26, 1396).
Connected by a video conference to gas production platforms, President Rouhani issued an order for commencement of commissioning of Phases 17-18, Phase 19 and Phases 20-21 of South Pars Gas Field and commented “These platforms will lead Iran to a progress and advancement which Iranian people deserve. I wish to express and extend my pleasure to all experts, specialists and workers who exhibited such sources of prides to the people of the world.” President Rouhani underlined “Every time we visited Assaluyeh in the past, we witnessed that a major step was taken for the progress of Iran. Today we can clearly see that all attempts made to this date have proved a great accomplishment. When a project begins its production, it implies that all Iranians have spared no effort under very difficult circumstances to see the project producing.”
President Rouhani went on to add “The day when a plus-20 billion-Dollar project is inaugurated, it is an unprecedented day in the history of the nation. Further, the fact that in a jointly-owned field, we are out-producing our neighboring country, and that since the beginning of our Administration, the gas production and output capacity have grown double-fold, suggest that if we remain united and consolidated, we can make utmost achievements.”
In the ceremony held for inauguration of Phases 17-18, Phase 19 and Phases 20-21, the Petroleum Minister, Engineer Zanganeh, commented that establishment of Petropars Limited (PPL) was one of the prominent accomplishments of oil industry in Iran, and added “Some people maintain that Assaluyeh was developed by money whereas I believe Assaluyeh was built by devotion, love of Iran and commitment.”
In the evening of the inauguration day, Managing Director of the National Iranian Oil Company (NIOC), accompanied by the Deputy Managing Director for Engineering and Development of NIOC as well as the Managing Director of Pars Oil and Gas Company (POGC) paid a visit to different sections of Phase 19 of South Pars Gas Field.
In the sidelines of their visit to Phase 19, Mr. Kardor described PPL as the “most successful” company in development of different projects executed at South Pars Gas Field. According to him Phase 19, which was completed in 35 months, is a very reliable and concrete evidence for such evaluation as Phase 19 was completed ahead of the time schedule, with lower costs and maximum quality, compared to other projects executed at South Pars Gas Field.
Liquid Propane and Butane Processing Units of Phase 19 Refinery Was Commissioned
Relying merely on the knowledge and expertise of Iranian specialists and experts and without presence of foreign advisors, caustic revival units, liquid propane and butane processing and ethane production units of Phase 19 for development of South Pars Gas Field was successfully completed and is in service already.
The operations for commissioning of the units were completed in the course of 3 months thanks to the unsparing attempts made by competent and capable colleagues of POMC to exhibit a strong step in the path to Resistance Economy.
We wish to express our sincere and cordial congratulations on the occasion of this great accomplishment to all workforces of Iran oil industries.
The “13th Kish Energy International Exhibition” with the main objective being “Investment in Iran” was held for 4 days to introduce Iran’s capabilities in the fields of oil, gas, water, electricity and renewable energies. POMC and KCT attended the Exhibition to expose their capabilities in oil and gas fields.
The said Exhibition, which was held at the permanent place of Kish Island Exhibitions, was attended by well over 140 Iranian and 40 international companies from Austria, Germany, USA, Spain, Italy, Switzerland, United Arab Emirates (UAE) and Iraq.
POMC and KCT represented Petropars and introduced their capabilities and competences in a pavilion set up to this end. Both companies provided responses to the questions raised by the visitors and conversed with and exchanged views with the representatives of the companies and contractors attending the Exhibition.
In the course of the days the Exhibition was held, Engineer Ms Shahdani, the Deputy Minister and Managing Director of the National Iranian Petrochemical Industries Company, Dr. Manouchehri, the Vice-Managing Director of the National Iranian Oil Company for Development and Engineering Affairs, and a number of high-ranking managers and directors of oil industries attended at the pavilions set up by Petropars Group to acquaint themselves with the activities and operations performed by the said companies and to exchange views on expansion of cooperation and collaboration.
Dr. Akbari, CEO of Petropars and Engineer Javadian, Managing Director of POSCO were included among the Special Guests of the Exhibition who paid visits to the pavilions set up by Petropars Group and held frequent negotiations with the managing directors of the companies and contractors attending the Exhibition.
When the Exhibition concluded, a Certificate of Appreciation was awarded to POMC considering their active attendance at the Exhibition by the manager in charge of holding the Exhibition.