President Hassan Rouhani said on Monday that Iran has adopted plans to reduce reliance on oil revenues and is currently almost not dependent on petro-dollars.
In an address to a ceremony to inaugurate three oil projects via a videoconference, he added the domestic oil industry used to shoulder the main burden in the country’s annual budget plan, IRNA reported.
The projects included initiation of production from Azar Oilfield (western Iran), inauguration of the ethane recovery unit of Kangan Petro Refining Company (KPRC) in southern Iran, and construction of the olefin unit of Kian Petrochemical Company (southern Iran), all implemented with $5 billion in investments.
Stressing that the role played by the oil industry is still a significant and major one, Rouhani noted that many of the activities in other domestic sectors rely on the oil industry.
Commenting on his administration’s performance in the oil and gas sectors since 2013, he said the country’s gas extraction has reached one trillion cubic meters a day from what amounted to over seven years ago, which was 600 million cubic meters per day.
Rouhani added Iran has outpaced Qatar in extraction from the South-Pars Gas Filed it shares with the Arab state in the Persian Gulf.
Iran’s production from the oilfields it shares with Iraq, located in proximity to the common border, has increased five-fold, the president said.
Extraction from joint oilfields
Speaking at the same ceremony, Oil Minister Bijan Namdar Zanganeh said Iran is in good condition in terms of oil extraction from the fields it shares with the neighbors, Shana reported.
He added Iran’s crude production in West Karoun oilfields (jointly shared with Iraq) has reached 400,000 barrels per day from 70,000 barrels.
Zanganeh said $2.6 billion have been invested in the development of Azar Oilfield and construction of KPRC’s ethane recovery unit.
The minister noted that Azar was among the country’s joint oilfields which had not been developed, saying that no crude was extracted from the field.
The project to develop the field began in 2012 following the signing of a buyback contract with a domestic company, he said, adding the project has been implemented in two phases.
Zanganeh put the field’s accumulated production at 36 million barrels of oil, noting that $1.6 billion have been invested in the development of the oilfield.
The minister said $1 billion have been invested to inaugurate the KPRC’s ethane recovery unit, which has a production capacity of 3.5 million tons per year.
Commenting on the construction of olefin unit of Kian Petrochemical Company, he noted that it is among the megaprojects of the domestic petrochemical sector which requires close to $2 billion in investments.
Addressing the ceremony, Keyvan Yarahmadi, the manager of Azar Oilfield’s development project, announced Iran has so far produced over 36 million barrels of crude oil from the joint field.
He added the contract for developing Changouleh oilfield, which is adjacent to Azar, will be signed in the near future.
Yarahmadi noted that the development project of this field, which is shared with Iraq and known as Al-Badra in the country, has been handed over to a consortium consisting of the oil industry employees’ pension and welfare funds and the Oil Industries' Engineering and Construction Group (OIEC).
Yarahmadi said the amount of Azar Oilfield’s in-place crude reserves is estimated at roughly 4.3 billion barrels.
The inauguration of the massive petroleum projects is a fresh blow to US sanctions targeting the country’s energy sector, according to Press TV.
In May 2018, former US president, Donald Trump, pulled his country out of the Joint Comprehensive Plan of Action (JCPOA), signed between Iran and the P5+1 in July 2015, and reimposed Washington’s sanctions on Tehran in a bid to cripple the Iranian economy and bring the Islamic Republic to the negotiating table to hammer out a new nuclear deal.
Being part of Washington’s “maximum pressure” campaign and mainly targeting Iran’s oil and banking sectors, the sanctions failed to produce the desired result thanks to Iranian people’s maximum resistance.
Rouhani’s website said the government had spent €1.44 billion ($1.74 billion) to ramp up oil production in Azar Oilfield, a reserve Iran shares with neighboring Iraq, to 65,000 barrels per day.
Iranian engineers have carried out a bulk of development works in Azar where operations had stalled in recent years because of US sanctions on Iran.
At the inauguration ceremony, Rouhani hailed Iranian engineers and technicians for successfully drilling oil wells in Azar that some of them had a depth of 4,800 meters.
The Iranian government has spent heavily to build out downstream petroleum industries in areas near the South Pars Gas Field.
Iran is currently extracting over 750 million cubic meters per day of natural gas from the field, a bulk of which is supplied to households and businesses and the rest in fed into refineries and petrochemical plants.