Nouroddin Shahnazizadeh, the managing director of the Petroleum Development and Engineering Company of Iran, told the domestic media that the leading European bidders for the project include Total (France), Shell (UK/Hollande), Eni (Italy), Wintershall (Germany), Rosneft (Russia), OMV (Austria) and Maersk (Denmark).

Shahnazizadeh added that several Asian companies including CNPC and Sinopec (China), ONGC (India), Pertamina (Indonesia), Petronas (Malaysia) and PTTP (Thailand) would also participate in a tender over South Azadegan.

The official said officials from the bidding companies had visited Iran for three days to become fully aware about the conditions of the project. Almost a dozen of them, he added, had been even taken to visit the project site.

Nevertheless, Shahnazizadeh did not indicate when the tender over South Azadegan would be held.

Iran has repeatedly postponed the tender over the giant field which it jointly shares with Iraq.

Reuters quoted an unnamed Iranian official as saying in June that the bidding over the project had been delayed by another few months.

This, the unnamed official told Reuters, was meant to allow energy companies more time to study the field.

Iran discovered Azadegan oil field in 1999 in what was the country’s biggest oil find in decades. The country accordingly teamed up with Inpex to push the project toward development. However, the Japanese company later quit the project in what appeared to be the result of US sanctions against Iran.

The NIOC later divided the project into South Azadegan and North Azadegan and both were awarded to China’s CNPC when Iran’s former president Mahmoud Ahmadinejad (2005-2013) was in office.

The media reported in 2014 that Iran’s Oil Minister Bijan Zangeneh had sidelined CNPC from South Azadegan due to its protracted delays in developing the field.

South Azadegan is believed to hold an in-place oil reserve of about 33.2 billion barrels and its recoverable resources estimated at about 5.2 billion barrels.

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Managing Director of Abadan Oil Refinery Company Esfandiar Daemolzekr informed reportes about the latest development status of and the plan to reduce fuel oil production in the oldest oil refinery of the Middle East saying “in partnership with China’s Sinopec, the plan to equip, develop and upgrade Abadan refinery will kick off as of the new Iranian calendar year (to begin March 21).”

The official recalled that the second development contract was inked with the Chinese side following implementation of the Joint Comprehensive Plan of Action (JCPOA) asserting “the initiative aims to boost profitability and reduce fuel oil production form the current 40% to less than 20 per cent.”

He emphasized that the refinery project required three billion dollars of investment adding “desalination units and those for purification of diesel and kerosene will be also expanded.”

On the third development phase of Abadan refinery, Daemolzekr said about 40 per cent of crude oil is currently turned into fuel oil due to ageing distillation units though reduction of fuel oil output has been put on the agenda.

He underlined that 8000 jobs will be created during five years of developing phase two of the Iranian refinery highlighting that for expansion of Abadan complex phase 4, talks are underway with a Japanese firm and a contract will be inked soon.

He referred to the held negotiations with Japan’s JGC Corporation Engineering company for carrying out the fourth development phase of Abadan Oil Refinery maintaining “the project will require nearly two billion euros of financing and it will reduce fuel oil output to less than 10 per cent.”

The official at National Iranian Oil Refining and Distribution Company (NIORDC) went on to stress that Abadan Oil Refinery began operation about 107 years ago with an initial output of 2700 barrels though its production figure has fluctuated over years.

“The refinery is currently supplying 25 per cent of the country’s gasoline demand,” noted Daemolzekr concluding “Abadan Oil Refinery is presently yielding seven million liters of Euro-4 gasoline and 100LL avgas per day.”

The post Iran, Japan launch €2bn oil talks for Oil Refinery appeared first on IRAN This Way.

The biggest deal is reserved for Japan’s Marubeni, Chiyoda and Mitsui companies to upgrade Isfahan refinery, Deputy Oil Minister Abbas Kazemi told reporters in Tehran, Press TV reported.

“Negotiations have been held with the three companies and the deal for this massive refining project worth $3.6 billion is expected to be finalized soon,” he said.

Another $2-billion contract is about to be signed with South Korea’s Daelim to boost oil processing capacity at Isfahan refinery, Kazemi added.

However, the most imminent contract, valued at $3 billion, is expected to be concluded within the next couple of weeks with the Chinese to develop and improve the quality of Abadan refinery.

Kazemi predicted the formal implementation of the project beginning in the current Iranian month, which started on January 21, with the participation of energy officials from the two countries as well as senior directors of China’s SINOPEC company.

The scheme is planned to cut furnace oil production at the plant to about 20 percent from the current 40 percent, the official said.

China has opened $1.3-billion credit line to financier the plan, he said, adding another $1.7 billion is expected to be opened in the spring.

Iran plans to sign contracts worth $14 billion to fix and upgrade the quality of Tehran, Bandar Abbas, Isfahan, Tabriz and Abadan refineries, said Kazemi who is also managing director of National Iranian Oil Refining and Distribution Company.

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Aiming at attracting maximum investment and modern technology, Iran’s Oil Ministry, in addition to introducing new model of oil contracts, dubbed as the Iran Petroleum Contract (IPC), has allowed National Iranian South Oil Company (NISOC) to prepare its own specific model for oil contracts.

The model of contract based on which the NISOC has signed several Memorandums of Understanding with international companies was drawn up an aim to attract foreign investment and new technologies.

Speaking on the sidelines of a meeting with Iranian companies, Managing Director of NISOC Bijan Alipour said his company was conducting meetings with qualified Iranian and foreign firms.

He urged domestic firms to pick up foreign partners in order to take advantage of financial resources and modern technologies for cooperation and development of Iranian oil fields.

He voiced optimism towards outcomes of meetings and expressed hope that a number of Memoranda of Understanding (MoUs) will be inked.

He said two MoUs had been signed with Pergas Consortium and Schlumberger in the framework of the NISOC contract model; “talks are underway with BP (British Petroleum), Argentina’s largest oil company YPF in addition to China’s Sinopec and CNPC.”

Alipour also pointed to the upcoming visit of PGNiG (literally: Polish Petroleum and Gas Mining) officials to Tehran in order to begin negotiations with NISOC.

Based on the NISOC contract, the Parsi, Karanj, Rag Sefid and Shadegan fields, consisting nine reservoirs, will be developed.

The nine reservoirs consist Asmari, Pabdeh and Khami reserves in Karanj field, Asmari, Bangestan and Khami reservoirs in Rag Sefid field, Asmari reservoir in Parsi field and Asmari and Bangestan reservoirs in Shadegan field.

Under the contract model, National Iranian Oil Company (NIOC) will be the employer and the NISOC will be executive leading the project on behalf of the NIOC.

The contractor of the project or the qualified Iranian or foreign oil companies will have to finance the projects.

NISOC contracts comprise two types including Contracts for Enhanced Oil Recovery (EOR) or Improved Oil Recovery (IOR) as well as Performance Based Contracting (PBC), also known as performance-based logistics (PBL).

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