Member of the parliament"s Energy Committee Abdolmajid Shoja" told Irna, "The associated gases produced in several wells of different oilfields are being flared, causing environmental pollution in the region."

"The project to collect the associated gases of the region, which is on the agenda of Iranian Offshore Oil Company (IOOC) within the framework of an NGL plant, has encountered a plethora of problems so far," he added.

The MP also said that IOOC officials have failed to reach agreement with Bushehr provincial authorities on the issue in the last few months. He added, however, the recent meetings on resumption of Kharg NGL project have yielded satisfactory results.

"Apart from financial benefits, the project will create some 4000 job opportunities in the region", the official said.

The IOOC is a subsidiary of the National Iranian Oil Company (NIOC), which is responsible for Iran"s offshore oil and gas projects.

The euro 1.500b Kharg NGL project is aimed at gathering some 6500 million cubic feet of the associated gases of the offshore and onshore fields of the region.

Part of these gases will be converted to Natural Gas Liquids (NGL) and another part will be used for injection into nearby oilfields so as to boost their output.

Supplying part of the required feed of the Olefins petrochemical plant of Kharg Island is another objective behind the said natural gas processing project.

Kharg NGL project resumed following a one-month halt due to environmental concerns.

Manager of this natural gas processing project in the Persian Gulf island of Kharg Nader Rahimi said, "The problems created with the Environment Protection Organization and some local officials on the island have been resolved and the project has resumed".

"Implementation of the project will avert the flaring of some 700 million cubic meters of associated gases in the region," he said.

"This project will be adding some USD 800m per year to the overall revenues of the country", the official added.

The project comprises a gas gathering scheme and processing on the island.

The gas would be used for the production of natural gas liquids (NGL) or for re-injections into the nearby oilfields to increase the crude output, both resulting in significant economic advantages for Iran.

According to the scope of the project, the associated gas from the oil fields in the northern parts of the Persian Gulf will be piped to Kharg Island for further treatment. The gas would otherwise be flared and release dangerous pollutants in the ecosystem of the region.

In March 2007, it was reported that the Kharg NGL project had been suspended due to objections from the Kharg island environment officials, and because of plans to develop the north of the island for tourism.

Norway"s Statoil signed a Memorandum of Understanding (MoU) in August 2006 to cooperate in the project, and is believed to be providing some USD 300-400 million finance for the project. This involvement stems from commitments under the Kyoto protocol to reduce flaring of associated gases.