Nasrollah Zarei, responding to questions about PEDEC’s accomplishments over the past year, said the 14th government prioritized the West Karun joint fields early on. “During this period, we have significantly increased the country’s oil production, most of which has come from joint fields,” he said.

Zarei noted that despite its vast capacity, the South Azadegan field had long faced production limits due to inadequate processing capacity. “The missing link was the Central Processing Unit (CPU), known as C-TAP, whose completion was delayed. At one point, by designing and deploying a skid-mounted prefabricated unit in less than a year, we partially addressed this issue and enabled production growth,” he added.

Overcoming capacity limits, preparing for increased production

Describing South Azadegan as one of Iran and Iraq’s largest shared oil fields with massive reserves, Zarei warned that each day of delay in fully developing the field means lost potential revenue and benefits for the neighboring country. Addressing processing constraints and establishing sustainable infrastructure have become top priorities for PEDEC.

He said the West Karun processing plant’s 165,000 barrels-per-day capacity had reached its limit with increased production at Azadegan and operations at Sepehr and Jofeir fields. “This meant we again faced processing capacity shortages, but with the commissioning of the first of four planned processing units at South Azadegan, this bottleneck was resolved.”

Zarei projected that by late September all completed wells in phase one would be online and that remaining oil units at the C-TAP facility would be finished by year-end.

Economic-environmental importance of associated gas capture

Zarei emphasized the gas segment of the Azadegan project, noting that the gas collection and compression unit—capable of handling 200 million cubic feet daily—has faced delays due to factors beyond the project team’s control. The goal is to start operations in the first half of next year.

“The delay mainly stems from difficulties procuring high-pressure compressors and sensitive equipment, which sanctions have made unavailable through direct purchase,” he explained. These items must be sourced indirectly, requiring longer lead times. Once collected, the gas will be sent to the NGL 3200 unit, which processes 500 million cubic feet daily from West Karun fields. Beyond conserving resources, this project plays a vital role in reducing pollutants and protecting the environment.

He stressed that capturing and converting associated gas into value-added products is not only economically sensible but also a crucial step toward sustainable oil industry development. “Preventing gas flaring reduces greenhouse gas emissions and improves the environmental conditions of operating areas,” he said.

Long-term planning needed for South Azadegan development

Zarei reported that in phase one of South Azadegan, drilling was planned for 206 wells. Due to updated reservoir studies, three wells were removed from the plan, four wells allocated for wastewater injection, and one designated as an observation well. To date, 182 wells have been completed and handed over to Arvandan Oil and Gas Company, with daily production reaching 165,000 barrels.

He described South Azadegan as a strategic field not only for boosting production but also for advancing domestic technologies. “Its vast reserves and complex reservoir conditions make it a field requiring long-term planning,” he said.

Regarding the Yadavaran field, Zarei said drilling of 24 wells has begun, which upon completion will raise production by 42,000 barrels daily. The plan aims to finish this phase by the end of next year. Negotiations continue with a Chinese partner for phases two and three, and technical and contractual talks are underway with a domestic company. Once phase two is fully operational, Yadavaran’s production capacity will exceed 165,000 barrels per day.

Continued drilling in joint fields

On the Azar field in Ilam province—one of Iran’s most challenging due to its hard layers and complex geology—Zarei highlighted the success of relying on local expertise. “Azar’s experience shows that using domestic capabilities can lead to success even in the most difficult fields, and this is now being replicated in other projects,” he said.

He emphasized the importance of ongoing drilling operations in joint fields, aiming to increase recovery factors and reduce drilling times. “We are deploying advanced rigs, directional drilling systems, and multi-branch well drilling to achieve this,” he said.

Mentioning Sepehr and Jofeir fields, Zarei announced the first-ever hydraulic fracturing operation in one well of each field, a technology expected to significantly boost recovery rates. They are also evaluating the use of sugarcane wastewater injection to enhance reservoir recovery, a critical and necessary measure.

For the first time in years, Zarei said dual-lateral drilling technology is being applied at Aban and Paydar Gharb fields with a Russian contractor, allowing production from two reservoir layers via one well, increasing output. Five additional wells are planned using this technology.

Oil industry committed to protecting Hoor al-Azim Wetland

In response to questions about balancing field development with environmental protection, Zarei said such conflicts exist worldwide but can be minimized through expert work and cooperation. “In Hoor al-Azim wetland, less than half a percent of the area has been affected by roads and pads, and future developments will not exceed one percent of the Iranian part of the wetland,” he stated.

“Our development plan is designed to occupy no more than one percent of the wetland and includes water channels to maintain water circulation, ensuring ecosystem preservation alongside development,” he added. He emphasized that environmental considerations are not only legal obligations but also a social responsibility, and the oil industry is committed to protecting Hoor al-Azim as a valuable national asset.

Zarei pointed out that past gas flaring wasted a valuable energy source and caused serious environmental and health damage. “By collecting and processing associated gas, we can supply downstream industries and petrochemicals while significantly reducing air pollution,” he said.

West Karun Fields generate $40b in revenue

Despite challenges, Zarei said West Karun oil fields now produce over 500,000 barrels per day. “Using new technologies and improving recovery factors will pave the way to higher production, provided investment and rig supply constraints are resolved,” he added.

He acknowledged the competitive disadvantage Iran faces compared to neighboring countries and warned that each day of delay in joint field development means losing part of the country’s resource share. “We must maximize development speed through precise planning, sustainable investment, and top technologies,” he said.

Zarei revealed that oil fields in the Hoor al-Azim wetland have generated about $40 billion in foreign exchange revenue so far, with an estimated $42 billion expected over the next five years.

Maximizing Iranian engineers’, experts’ capabilities

Looking ahead, Zarei said PEDEC will continue focusing on joint field development, especially in West Karun, with new projects planned to expand capacity at Azadegan, Yadavaran, Azar, and other shared fields. The installation of a prefabricated desalting unit at the Cheshmeh Khosh production facility is also planned to temporarily alleviate production limits from wells with high water content.

He stressed that achieving production goals requires simultaneous development of infrastructure and introduction of advanced recovery and drilling technologies. “We have studied successful experiences from similar countries to find models that reduce development costs and accelerate progress. We also plan to manufacture a significant portion of equipment domestically to reduce import dependence,” he said.

Zarei said these plans depend on cooperation with domestic contractors and full utilization of Iranian engineers and specialists. “The private sector has demonstrated its capability to execute major oil projects, provided contracts and working conditions are stable and predictable. New contract models have motivated faster investment and project execution,” he added.

Removing financial barriers key to progress

Citing financial constraints as a major obstacle, Zarei explained that most oil sales revenues currently go to the government treasury, and PEDEC’s 14.5% share of sales income does not even cover operational costs, let alone development investments. “This financial model is unsustainable because development projects require continuous and substantial funding,” he said.

He called for reforming the financial relationship between the government and the National Iranian Oil Company to allow a portion of revenues from increased production to be directly allocated to field development. “Such a model would eliminate bureaucracy and reduce unnecessary costs like financing from oil revenues,” he said.

Zarei noted that the 14th administration has shown serious commitment to these goals. “If we can smooth financial supply and remove equipment procurement obstacles, especially for drilling rigs, we will witness a significant increase in oil production from the largely joint West Karun fields,” he concluded.

West Karun Power Plant Supports national grid

Regarding exports from the Jask terminal, Zarei said the third shipment has been loaded, creating a new capacity that allows regular, uninterrupted exports and reduces dependence on a single export route.

He also discussed the West Karun power plant, which has been operating for several years at 430 megawatts capacity. Besides meeting the fields’ electricity needs, its surplus power feeds into the national grid. However, the Ministry of Energy has yet to pay for the electricity supplied.

Zarei highlighted PEDEC’s collaboration with universities, noting that social studies with Shahid Beheshti, Ilam, and Jundishapur universities identified local communities’ real priorities. This enables social responsibility budgets to be scientifically based and coordinated with provincial authorities, leading to impactful infrastructure projects instead of scattered efforts.

Oil industry staff on the front lines of economic war

Expressing gratitude to all employees and contractors, Zarei said these achievements result from thousands working around the clock under difficult conditions and constraints to develop Iran’s oil industry. “The future of Iran’s oil industry depends on the perseverance and dedication of these skilled and committed professionals,” he said.

He concluded by acknowledging the economic war the country faces, with oil industry colleagues on the front lines. “Their presence during the 12-day conflict and aggression by the Zionist regime in all production and development sites prevented production drops or project delays, demonstrating their courage and sacrifice. I sincerely thank all these individuals,” Zarei concluded.