One of the officials present in Saturdays talks between Iran and China on expansion of mutual cooperation in the oil industry told the correspondent of Petroenergy Information Network (PIN): “There were some differences of views on development of Yadavaran oil field and sale of LNG with Sinopec Company of China which were settled in the meeting.” Speaking of the Chinese companys contribution to the development of North Azadegan oil field, he added that Iran had also offered some proposals to Chinese companies on establishment of refineries where were under study. He also predicted that the contract on development of huge Yadavaran oil field and sale of LNG to China will be finalized during a visit to Tehran of the minister in charge of commission on development and national reforms of the Peoples Republic of China slated for the second half of December. According to PIN, Dr. Nejad-Husseinian was also present in the meetings of Foreign Minister Manouchehr Mottaki and officials of Chinese oil companies. According to Mottaki, during the meetings grounds had been prepared for long-term agreements between the two countries with the two sides reaching some agreements on certain technical aspects of Yadavaran development project. The implementation of Iran LNG project and supply of this commodity to China, contribution of Chinese firms to development of Yadavaran and Azadegan oil fields and construction of refineries in Iran are among the most important axes of the meetings. Chinese in Iranian oil fields The governments of China and Iran, On the basis of a letter of understanding signed by the Chinese commission on development and national reforms and the Iranian Oil Ministry in last October 2004, declared their interest in consolidating mutual friendly relations and boosting bilateral cooperation in the field of energy. Encouraging Iranian and Chinese firms to enter into joint oil and gas exploration and development projects, oil refineries, petrochemical industry, CNG pipeline, services contract projects and rendering related services are among the most important axes of this letter of understanding. Moreover, supporting the gradual promotion of oil trade between Iranian and Chinese companies and establishment of a joint committee on mutual cooperation in oil, gas, petrochemical, CNG and LNG fields within the framework of Iran-China Joint Economic Commission was given due attention. Contribution of Sinopec Company of China to the development of Yadavaran oil field in partnership with a leading international oil firm is another point on which the two sides have reached an agreement. The last session on technical survey of the Yadavaran development project was held in Tehran on September 27. Based on the letter of understanding between Iran and China, after completion of the Yadavaran development project, the National Iranian Oil Company will sell 150,000 barrels of per day at the prices of international market to Sinopec for a period of 25 years. Earlier, the Chinese companies in their meetings with Iranian Oil Ministry officials had announced their readiness to take part in the development of Jofeir and Caspian Sea oil fields. Companies Active in Upstream Sector At present, Sinpec is engaged in exploratory operations in Zavareh bloc in Kashan which indicates the existence of oil reserves in the bloc. Moreover, the second well drilled in this central desert region reached gas on October 10. Technical surveys aimed at measuring the exact amount of gas reserves in this bloc are underway. The National Iranian Oil Company has finalized a buy-back contract with CNPC of China for simultaneous exploration and development of Kuhdasht bloc which occupies an area of 8,240 square kilometers. The least expenses undertaken by the contractor during the implementation of the project has been put at 18 million dollars which can be increased to 51 million dollars in case there is a need for further studies. Besides, the negotiations between the company and representatives of National Iranian Gas Company for contribution to the Pars LNG project are underway. China in Dire Need of Energy At the end his two day official visit to China, the Iranian foreign minister, referring to the ever increasing consumption of energy in China as the two largest consumer of energy in the world, has expressed Irans pleasure in meeting parts of the energy needed by China for its booming economy. Cooperation between Iran and China has entered a strategic stage, Mottaki said, adding that between 2020 and 2030, Iran will turn into the worlds second largest producer of oil and thus those countries looking for a guarantee for their energy supply can count on Iran as a reliable partner. Development of energy cooperation between Iran and China has become the focal point of attention at a time when the “Standards and Pours (?)” financial institute in its latest research report has announced that Chinas efforts to find new sources of energy in the future will certainly exert pressure on the international oil markets and eventually damage international relations. According to the report of this institute, the current pressure on China in the field of energy will keep on mounting in the next two decades which is one of the factors behind hike in energy prices. China as the second largest consumer of energy after the United States consumed around 314 million tons of crude oil in 2004 of which 122 million tons were imported.