Tehran: Iran expects to finalize two energy contracts totalling $7 billion with an unnamed European firm and India’s state-run Oil and Natural Gas Corp. Ltd (ONGC), state broadcaster IRIB said on Tuesday.
Citing Mahmoud Zirakchian-zadeh, managing director of Iranian Offshore Oil Co., IRIB said the contracts would be signed in the near future, without elaborating.
Zirakchian-zadeh did not name the European firm which he said had completed a development plan for the offshore Lavan natural gas field in the Gulf. “We are now involved in serious negotiation on the contract’s financial aspects,” he told IRIB, estimating the investment at $4 billion.
Major European firms France’s Total SA and Royal Dutch Shell Plc. have delayed or scrapped plans for multi-billion-dollar natural gas export projects in Iran, which is under UN and US sanctions over its disputed nuclear work. The Lavan gas field, which was discovered in 2003, has in place reserves of around 10 trillion cubic feet.
Zirakchian-zadeh also said ONGC had completed a development plan for the Farzad gas field, which forms part of the Farsi block in the Gulf, and that “contractual and financial negotiations” are under way.
That investment would amount to $3 billion, he said.
Separately, state television quoted him as saying ONGC had discovered an offshore oilfield, Binaloud, in the Farsi block with one billion barrels of in-place reserves of heavy crude.
In November in New Delhi, an official at a firm holding a stake in the block said Iran had approved the commercial viability of natural gas production at the Farsi block operated by Indian firms.
The official, who declined being named, said then the firms would submit a $3 billion development plan to Tehran.
ONGC and Indian Oil Corp. Ltd each hold a 40% interest in the block, while Oil India Ltd has the rest. It is operated by ONGC’s overseas arm ONGC Videsh Ltd.
The block is estimated to hold recoverable gas reserves of 12.8 trillion cubic feet.
Iran is drawing interest from Indian and Chinese firms keen to tap the world’s second largest reserves of oil and gas and are less susceptible than many other companies to Western pressure over Tehran’s nuclear programme.