Royal Dutch/Shell Group, Europe's second-largest oil
company by market value, bid last month to develop new oil fields in
Iran as its existing development contracts run out, a Shell spokesman
The Iranian National Oil Co., the second-largest
state-owned oil company in the Middle East, said last week it was
reviewing bids by foreign companies to explore and develop 16 potential
oil fields. More than 30 companies bought the tender documents for the
developments, Middle East Economic Digest reported on Sept. 3, without
saying how it got the information. Shell and China Petroleum &
Chemical Corp., known as Sinopec "bid together in the current
exploration round in Iran where we see a number of business
opportunities in the longer term,'' Shell spokesman Simon Buerk said in
a telephone interview from London. "Sinopec is a fast-growing
international player and together we are pursuing a number of other
Shell is trying to boost oil reserves and production
after revealing earlier this year it had wrongly categorized more than a
fifth of its holdings as proved reserves. The US Federal Securities
& Exchange Commission allows companies to book oil supplies held
under Iranian buy-back agreements even though Tehran forbids foreign
companies from owning reserves, which are considered a national
The development of the Soroush and Nowruz offshore
oil fields, Shell's only existing oil holdings in the Middle East's
second-largest oil producing country, are scheduled to reach total
production capacity of 190,000 barrels a day by the end of the year,
Buerk said. Shell also owns a 25 percent share in the Pars Oil Co.,
which produces and markets lubricants in Iran.
Sinopec, Asia's largest refiner, four years ago
signed a strategic alliance agreement with Shell for operations in
China, which this year overtook Japan as the world's second biggest
importer of crude oil.
INTERNATIONAL CONSORTIUMS COMPETING FOR SOUTH PARS
The Iranian Oil Ministry is currently studying the
latest proposals and holding discussions with four international
consortiums that have offered tenders to implement phases 15 and 16 of
the South Pars oil and gas field.
Asadollah Salehi Foruz, the managing director of the
South Pars Oil and Gas Company, announced on September 4 that oil
companies from South Korea, Britain, France, Norway, and Switzerland are
competing to gain access to the giant South Pars Development Project.
He also said that these companies are required to
enter a joint venture with Iranian companies in order to win the bid.
Iran's Sadra Company, the Khatam al-Anbiya
Reconstruction Headquarters, and the consortium of subcontractors to
Petropars are participating in a bid for the right to develop phases 15
and 16 of the South Pars gas and oil field.
South Pars, the world's largest natural gas field, is
located in the Persian Gulf straddling the Iran-Qatar maritime border.
Iran has 18 percent of the world's natural gas
reserves, giving it a strategic position in the global gas market.
One of the main programs for the development of
Iran's gas reserves is the giant South Pars Development Project.
With the implementation of the 20 phases of the South
Pars Development Project, it is projected that a daily amount of 25
billion cubic feet of natural gas and one million tons of gas condensate
will be produced, as well as varying amounts of other gas products.
Iran's natural gas reserves are five times those of
North America, four times those of Europe, three times those of the
Asia/Pacific region, and amount to half of all Middle Eastern natural
Therefore, due to its geographical position, Iran can
play a key role in the world gas market and act as a bridge between the
giant gas reserves of the Middle East and the great gas-consuming
centers in Europe and Asia.
Iran started to export natural gas to Turkey in 2001.
It has also signed a contract to export gas to the United Arab Emirates
and is in the final stages of talks with Kuwait to seal a gas deal.
Iran is also conducting talks on a project to
transfer gas to India through Pakistan. The recent reduction of
India-Pakistan tension should facilitate implementation of the project.
Multinational oil and gas corporations have shown
great interest in investing in Iran's energy sector.
—Courtesy Tehran Times