Fortunately, our country abounds in natural gas reserves in the form of independent resources and those which are shared with neighboring countries, including Qatar in Persian Gulf.

According to official figures released by the Iranian Ministry of Petroleum, natural gas resources of the country amount to about 28 trillion cubic feet, which is equal to 15 percent of total world reserves. Eight percent of Iran’s gas reserves are contained in huge South Pars gas field.

Existence of huge gas reserves in the country call for calculated strategy to make the most of such resources for the betterment of domestic economy.

Fortunately, good steps have been taken during recent years to formulate such strategy, so that development of South and North Pars gas fields for extraction of billion cubic feet of gas are major examples in this regard. According to this strategy, which is currently in the making, storing natural gas has been focus of attention as an important and necessary issue.

During past few years, more oil and gas reserves have been found across the country.

When talking about natural gas and supplying it to more than 53 million Iranians, one usually remembers National Iranian Gas Company and its role as the authority in charge of supplying gas to Iranians.

In view of intense need to timely supply of natural gas, the company has paid serious attention to gas storage and has taken many practical steps in this regard. Therefore, it has established an independent company specializing on gas storage and a number of important plans are being implemented by that company.

In the following interview, Abdolhossein Samari, official in charge of gas storage at the National Iranian Gas Company, explains about those plans.

Q: As a beginning, please explain about gas storage and its importance to our country.

A: Countries that host huge gas resources are planning to take good advantage of it. Fortunately, our country enjoys huge gas reserves and we must store equal to 10-15 percent of our annual consumption in order to reach a stable state in domestic gas network.

Q: What portion of domestic gas production is allocated to domestic consumption?

A: In view of development of gas supply in the country, gas storage lags behind. Therefore, we must enhance activities in this regard to make up for the past delays. In view of increasing consumption of natural gas in the country, we need to store 10 billion cu. m. gas.

Q: What do you mean by “delay”?

A: During past years, this part of gas industry has undergone many tests in terms of organization and its status, and therefore, less time has been paid to gas storage. However, now that due attention is paid to gas storage by the National Iranian Gas Company and officials are unanimous in this regard, gas storage is expected to take on more speed.

Q: Where do we stand right now?

A: We are still at the beginning of gas storage, but good efforts have been made to pass through this juncture.

Q: Will you please explain?

A: Two important projects are being implemented in Yortsha region of Varamin and Sarajeh region of Qom for storing natural gas, each of which is going through various phases.

Q: Will you please explain about Yortsha project in Varamin?

A: Yortsha reservoir is located 70 km south of Tehran near Varamin city. It is among reservoirs, which can store 600 million cubic meters gas when operational. The project has been defined in two phases. The first phase was implemented through an investment of about 10 million dollars in 1999. At present, the second phase is underway. The second phase is being implemented by Sofregas Company of France and Iran’s Pars Gostar Energy Exploration Company. The phase is to be made operational in 2009 through total investment of over 120 million dollars.

Q: What have you done about that reservoir?

A: At present, the first stage of the second phase of the project is being implemented. It consists of drilling two exploration and two appraisal wells to determined gas storage capacities of the reservoir. The foreign consultant of the project (the French Sofregas) is trying to finalize its studies. The second stage of the second phase will include drilling more wells for production and injection of gas, establishment of surface installations and inauguration of a station for injecting gas into the reservoir.

Q: To what extent are you optimistic about the results of studies?

A: In view of studies and measures taken so far on Yortsha reservoir of Varamin, it can be described as a safe store for natural gas and we hope that after receiving final report of Sofregas, we would be able to start the second phase of the project as soon as possible.

Q: Is the project being carried out independently, or is National Iranian Oil Company also involved?

A: No. Gas storage at Yortsha reservoir of Varamin is being done independently by the National Iranian Gas Company.

Q: What is the estimated cost of the project?

A: It depends on the type, volume and capacity of the reservoir. If gas storage reservoirs are of hydrocarbon type, since there would be no need to such operations as drilling appraisal wells, testing wells and evacuating their water. Certainly, the cost ill be lower. With regard to this reservoir, since it is filled with water and since expected storage capacity has been predicted at 600 million cu. m. of natural gas, cost estimates stands at 110 million dollars. At present, less than 20 million dollars have been spent.

Q: Please explain about Sarajeh project in Qom province.

A: Sarajeh reservoir of Qom province is hydrocarbon reservoir, which is located 40 km from Qom and is among those reservoirs whose studies are being carried out jointly by the National Iranian Gas Company and the National Iranian Oil Company.

Q: Which part of the project is responsibility of the National Iranian Gas Company and at what stage it is?

A: The National Iranian Gas Company is in charge of installing processing facilities, evacuating the reservoir, as well as engineering and procurement. The project has progressed 30 percent and the contractor is setting up the workshop.

Q: How much gas can be stored in the reservoir?

A: According to current studies, projected capacity for natural gas storage at the reservoir can be increased from 1.5 billion cu. m. to 2.5 billion cu. m. and even 3.3 billion cu. m. and this is good news for gas storage in the country.

Q: What stages will the reservoir go through?

A: Gas storage at Sarajeh reservoir of Qom will be implemented in two phases. Drilling a horizontal well and repairing three existing wells are major steps to be taken in the first phase. Evacuating the existing gas of the reservoir, engineering design of the reservoirs, drilling seven wells for injection and extraction of gas and designing surface installations for collection and processing of gas and gas condensate are major steps to be taken in the second phase.

Q: How long it will take to evacuate the reservoir?

A: According to the latest report prepared by the National Iranian Oil Company, it will take 15 months to evacuate the reservoir.

Q: Please explain about its current state.

A: Based on existing projections, the reservoir’s installations will be made operational by the end of the current year provided that the National Iranian Oil Company would be able to provide developmental wells and related installations for gas collection as part of upstream operations. Also, in a joint session with National Iranian Oil Company, final model of the reservoir was approved and gas injection operations were assigned to the National Iranian Gas Company. We hope that building gas injection station with capacity of 7 million cu. m. will be made operational by the end of the Iranian (calendar) year 1378 (ending March 2010).

Q: What have you done about Talkheh reservoir and the problem you were facing with the Department of Environment?

A: Talkheh natural gas reserve is the third gas reservoir plan to be implemented by the National Iranian Gas Company. The reservoir can save 2.5 billion cu. m. gas and is bigger than other two reservoirs. However, since it is located near a national park and due to subsequent differences with Department of Environment, the projected has been stopped at the stage of studies.

Q: What measures have been taken to solve that problem?

A: We have done a lot of correspondence with Department of Environment to remove executive obstacles and we have held many sessions. We have communicated our views to them and explained the importance of gas storage. Since the project will take into account environmental issues, there is a great hope that we would achieve positive results in the near future and we hope that Department of Environment would issue needed permits for exploration studies to the National Iranian Gas Company as soon as possible.

Q: What is the situation of other storage projects such has Shourijedi B and D?

A: Shourijedi B and D reservoirs are other storage projects. However, the National Iranian Gas Company will release the report of final studies on those reservoirs in the near future. At present, the studies have progressed 95 percent.

Shourijedi B and D will store sweet gas, which does not need to be treated. Based on the latest reports, thus far, 40 percent of one reservoir, and 70 percent of the other reservoir, has been evacuated. All signs point to readiness of the reservoirs for delivery of natural gas. However, engineering studies should be carried out to make sure about this issue.

Q: What about the feasibility plan which is being considered for gas storage in central Iranian region?

A: As the name denotes, the plan studies feasibility of gas storage over an area of 160 square kilometers. The plan’s area will be limited to Qazvin and Kavir Desert to the north; to Qazvin, Arak, and Khomein to the west; to Isfahan and Naein to the south; and to Yazd and Kavir Desert to the east. The area is expected to host four to five new reservoirs which would be suitable for gas storage.

Q: What role can be played by the private sector in speeding up gas storage in the country?

A: The private sector can take part in gas storage projects according to BOO (build, operate, own) or BOT (build, operate, transfer) schemes. Relevant proposals have been forwarded to the Ministry of Petroleum and the minister of petroleum is considering them positively.

At present, legal studies on feasibility of private sector’s involvement in such projects are being carried out and we hope to develop gas storage in the country by taking advantage of private companies through contractual schemes.