Shana

How EU gas price cap impacts markets

The European Union (EU) has over the past two decades sought to deregulate gas, thereby supporting gas pricing based on market mechanism in gas hubs versus oil-indexed gas pricing in long-term contracts. However, in the midst of Russia-Ukraine tension and the subsequent spike in gas prices, the European bloc has for the first time set a price cap for gas transactions in a bid to blunt gas price fluctuations. But what are the consequences of this policy? What message are the Europeans sending to the gas market? The Gas Market Division of the Directorate of OPEC and Int’l Energy Fora of Iran’s Ministry of Petroleum has studied this policy and its impact on global markets.

War in Ukraine and changing geopolitics of energy

As the war in Ukraine surpassed the one-year threshold with no solid evidence that it may end soon, the international oil and energy markets demonstrate its resilience to stand to the task. International oil market and energy market was once hit by COVID late 2019 and suffered hugely throughout 2020 and part of 2021. However, thanks to coordination between OPEC and non-OPEC producers, the market found its way towards normalcy and stability.

Iran, Saudi normalize ties at critical juncture

The Islamic Republic of Iran and Saudi Arabia, the two great oil reserves holders and producers of the Middle East and OPEC, have agreed to restore relationship that was severed during some seven years ago. The deal on restoration of ties was brokered by China and finalized in Beijing on 10 March 2023. The decision to restore ties may not have an immediate impact on the geopolitics and energy tectonic of the region and the world but, in my opinion, will rewrite the Middle Eastern pathway towards a much better dynamics. We’ve been discussing the “Asian Century” and a gradual relocation of eco-political center of gravity from West to South for quite some time. A couple of major international events; however, expedited the cycle of events.

Iran rivals foreigners in exploration

Exploration in Iran’s petroleum industry has advanced to the extent that a large number of countries currently are asking Iran to share its geological experience with them. Mehdi Fakour, director of exploration at National Iranian Oil Company (NIOC), has said Iran has achieved geochemical and geobotanic technology in oil exploration, thereby becoming a rival to foreign companies in exploration technologies. Iran is currently in oil and gas exploration relationship with four neighbors. Talks are also under way for exporting local know-how and equipment to these countries. Fakour said it would create value and income for Iran.

Ilam refinery gas processing up 10mcm/d

Ilam gas treatment facility is the only facility in western Iran. Sprawling on 250 ha of land, it supplies gas to western provinces in addition to feeding downstream industries including the Ilam Petrochemical Plant. The CEO of Ilam Gas Refining Company Ruhollah Nourian has said the refiner fed 1.174 bcm of gas into national grid during the first three quarters of the current Iranian calendar year (ends on March 20), up 9% year-on-year.

Iran exports petchems under own brand

CEO of National Petrochemical Company (NPC) Morteza Shahmirzaei has announced plans for exporting “Iranian-branded” petrochemical products in the current calendar year.

West Karoun, Iran new oil civilization

West Karoun area in western Iran is expected to form a new oil civilization. Based on plans, Iran intends to rely on the 11 oil fields located in this area with a view to lifting its crude oil output from West Karoun fields to 1 mb/d within four years.

Abadan refinery throughput up 210 kb/d

In coincidence with the anniversary of nationalization of Iran’s petroleum industry, President Ebrahim Raeisi and Minister of Petroleum Javad Owji oversaw the inauguration of the first section of a project aimed at enhancing output from the Abadan oil refinery. Noting that the second phase development of the Abadan refinery was aimed at ending crude oil sales.

Gas renaissance after oil reservoirs depletion

By development of Khami reservoir and using associated gas extracted from fields run by National Iranian South Oil Company (NISOC), the company will commence its second step toward development in the oil-rich regions so that by taking this measure we will witness taking primary measures in line with reaching gas renaissance in an area ofover70, 000 square kilometers stretching from Bushehr province to Khuzestan province.

Gas gathering picks up pace

Iran plans to gather 8.2 mcm/d of flare gas as of next calendar year (starting on 21 March 2023), which would increase 18.2 mcm/d during next year. Therefore, Iran would have gathered 50% of its flare gas by March 2024. In the calendar year to March 2025, Iran would be gathering 17 mcm/d of flare gas and during the following year, gas gathering would be at 7 mcm/d. Therefore, Iran would have gathered all its flare gas by 2025. Over 150 bcm of flare gas is turned into air pollutants at oil wells every year across the world. According to the World Bank (WB), that is equal to one-third of Europe’s total gas consumption. According to WB data, until 2018, Iran was the third largest producer of flare gas, behind Russia and Iraq. Flaring in Iran was down from 17 bcm in 2018 to 13.78 bcm in 2019.

Sanctions fail to paralyze Iran oil industry

SHANA (Tehran) – Sanctions imposed by the enemy have failed and will fail to paralyze Iran’s largest supplier of energy and foreign currencies – the Ministry of Petroleum.

Iran excelling in conventional, unconventional fields study

Experts at Research Institute of Petroleum Industry (RIPI), which is the main center of research and exploration for gas hydrates in Iran, say that each cubic meter of gas hydrate generates as much thermal value as 164 cubic meters of gas. Common technologies used for recovery from these resources may be costlier than technologies used for recovering from conventional resources; however, the cost-effectiveness of gas hydrate recovery becomes known when conventional resources go on the decline. Touraj Behrouz, head of Upstream Industry Research and Development Division of RIPI, has said good achievements have been made in modelling, studies and lab activities in both conventional and conventional fields.

Iran among sponge coke technology proprietors

Iran has joined the six countries possessing technical know-how to produce sponge coke. Sponge coke production has started in the Bandar Abbas oil refinery after upgrading the quality of heavy products there.

Maroun oil/gas output to rise 5%

Maroun Oil and Gas Production Company (MOGPC) is expected to see its oil and gas production grow 5% as new modifications are under way in its pipelines. Qobad Nasseri, CEO of MOGPC, told “Iran Petroleum” that plans were also under way to end the flaring of 40 mcf/d of associated petroleum gas.

Tehran, Beijing sign 20 documents

Iran, reliable partner for world energy supply

The Iranian president, Ebrahim Raeisi, visited China at the head of a high-ranking delegation at the invitation of his Chinese counterpart Xi Jinping in mid-February. Minister of Petroleum Javad Owji was accompanying the president. During the three-day visit, 20 documents of cooperation were signed between the two nations in various sectors. Raeisi highlighted Iran’s huge oil and gas reserves, saying: “Iran-China partnership in maintaining energy security can help establish peace and bring about development at the regional and global levels, not to mention guarantee shared interests.”

$3.4bn projects inaugurated in Assaluyeh

President Ebrahim Raeisi and Minister of Petroleum Javad Owji oversaw inauguration of oil projects worth $3.4 billion in Assaluyeh. Chief among them were the refinery of Phase 14 of the giant South Pars gas field, the Pars Glycol Petrochemical Plant and 9 petrochemical storage tanks. 

3 Oil Field Development Projects Due Soon

TEHRAN (Shana) -- National Iranian South Oil Company (NISOC)’s plan to develop 28 reservoirs, with the focus being on output preservation and enhancement, is accelerating. Ali Reza Daneshi, CEO of NISOC, said that obstacles in the way of development of the 28 reservoirs, including contractors’ supply of commodities and payment issue, have been taken into consideration. He expressed hope that the Nargesi, Kaboud and Lali Asmari fields would have been developed by March 2023.

Transition to New Order in Oil Market?

TEHRAN (Shana) -- The Iranian Petroleum Ministry’s Directorate of OPEC and Int’l Energy Fora has analyzed the oil market to conclude that last year’s developments gave rise to a new tug-of-war, which will soon result in a new balance of forces. In the new order envisaged for the oil market, Western governments will see their monopoly decline on the oil market which would turn into a regional market with a lower level of integration. However, the trans-Atlantic energy market between North America and Europe is projected to show further integration.  

2022 Oil Market Review and 2023 Forecast

TEHRAN (Shana) -- As the international oil market warms up for 2023 let’s take a look at major events that had immense impact on the world oil markets in 2022. The global energy market was just done with Pandemic that hit demand in early 2020 jeopardizing the supply chain most severely. Producing countries need to be praised and acknowledged for the wonderful job of adjusting skillfully with the demand destruction leading to a swift balance in the market. However, early in 2022 the international oil and energy market was confronted with a severe blow when the Russian conflict with Ukraine broke out on 24 February 2022.

South Pars Gas Output at 705mcm/d

TEHRAN (Shana) -- Gas recovery from the giant South Pars offshore gas field, which Iran shares with Qatar, has reached 705 mcm/d. Minister of Petroleum Javad Owji has said natural gas consumption by domestic and business sectors has increased 60 mcm/d year-on-year. A review of Iran’s gas consumption through the 1986-2016 period indicates a 10% growth in gas consumption, which requires renewed production to head off any shortages in cold months. That is why efforts are under way to reverse the upward trend in gas consumption.

Mothballed Oil Wells Rehabilitation

TEHRAN (Shana) -- National Iranien Oil Company (NIOC) has long focused on developing technologies to enhance recovery from oil wells. Although sanctions have posed an obstacle in its way, it aims to cut short the way to its objective by embarking on a quick-yielding project for the rehabilitation of low-output and abandoned wells. In this manner, by spending much less than drilling new wells, NIOC would be able to enhance its crude oil output. Without enhancing oil output, no future may be envisaged for enhanced oil recovery (EOR) projects. Therefore, the important thing would be to enhance production in any possible manner. Internationally speaking, more oil production would empower Iran to become more influential in the oil market while remaining resilient to challenges and restrictions because in the economic and political structure of the world energy, oil barrels have the final say.

18 Processing Units at Abadan Refinery

TEHRAN (Shana) -- Being the first oil refinery in the Middle East set up more than 110 years ago, Abadan oil refinery is considered one of Iran’s refining hubs, but due to the dilapidation of some of its units, its renovation and updating using modern technology is inevitable. For this purpose, replacement and renovation of the refinery was carried out in two stages, the first stage with the construction of a new refining complex of 150,000 b/d as phase 1 in 2005 and the second stage with the construction of a new refining complex with a capacity of 210,000 b/d under the title of Abadan Refinery Capacity Development and Stabilization Plan as Phase 2 started in July 2017 and the first part of it was put into operation in December. Therefore, the final capacity of the refinery was stabilized at 360,000 b/d.

Investment in Crude Oil Storage Capacity

TEHRAN (Shana) -- A meeting was held to introduce opportunities for investment in crude oil storage tanks construction and operation, required by National Iranian Oil Company (NIOC), within the framework of public-private partnership (PPP). This is the first time the private sector is given the chance for investment in the crude oil storage sector. NIOC intends to enhance its crude oil storage capacity by 7.7 million barrels.

SP14 Refinery Close to Operation

TEHRAN (Shana) -- The refinery of Phase 14 of the giant offshore South Pars gas field is almost coming online. With the completion of this megaproject, which has been operated only by Iranians, all South Pars refineries would have become operational. The offshore section of this project came on-stream in 2019 with a current output of 56 mcm/d of rich gas. Over the past one year, three trains of gas sweetening have become operational at this refinery, which sets a record. The onshore section of this project has been invested $5.2 billion in.

Foreign Firms Keen to Invest in Downstream Petchem

TEHRAN (Shana) -- The CEO of Persian Gulf Petrochemical Development and Investment Group (PGPDIG) says the holding has currently more than $650 million worth of projects under way. He told “Iran Petroleum” some of Iran’s neighbors had called for joint venture with PGPDIC, expressing hope for the finalization of an agreement in the current calendar year.

Iran Oil Refining Capacity to Hit 3mb/d

TEHRAN (Shana) -- Under the 7th National Economic Development Plan, Iran is required to reduce crude oil and natural gas sales by developing the value chain and bring its oil refining capacity to 3 mb/d. Meantime, Petroleum Ministry is following up on the completion of incomplete refining projects in light of the imbalance in petroleum products consumption in the country.

Enhanced Recovery from 600 Wells Planned

TEHRAN (Shana) -- CEO of National Iranian Oil Company (NIOC) Mohsen Khojasteh-Mehr recently told a conference on oil and gas wells enhance recovery that $2.5 billion had been invested in the refinery of phase 14 of the giant offshore South Pars gas field. He said the 3rd train of SP14 refinery had become operational, adding: “The gas from the 3rd train of this refinery has been fed into the national gas distribution network. The next train is expected to become operational soon.”

35 Pacts with Academic, Scientific Centers

TEHRAN (Shana) -- Realization of objectives set for a jump in knowledge-based production, revising instructions, bylaws as well as research project procedures for facilitation are among top priorities of the Office of Deputy Minister of Petroleum for Engineering, Research and Technology. This Office has adopted a comprehensive plan to follow up on 50 major subjects.

Focus on Caspian Sea Oil/Gas Swap

TEHRAN (Shana) -- Iran enjoys great potential for delivering oil, gas and petroleum products to regional and global markets, due to its geographical position and potential energy and mining reserves. Having such potential in mind, efforts have started to put the country on the path to becoming the energy hub of the region. The first step was the signing a gas swap agreement for the delivery of Turkmenistan’s gas to Azerbaijan via Iran’s territory. Now, as the 13th administration is in its second year in office, the focus is on exporting products, bartering and swapping via the Caspian Sea, in which case, cooperation is planned with foreign firms including Russian companies. 

LPG Exports to Earn Iran $360mn Annually

TEHRAN (Shana) -- Having exported 2,000 tonnes of liquefied petroleum gas (LPG) offshore for the first time from the Shahid Bahonar jetty, Iran has joined countries exporting LPG offshore. With the offshore export of LPG, some obstacles ahead of transiting this valuable product have been removed and transportation costs have been saved on at National Iranian Oil Products Distribution Company (NIOPDC). Meantime, according to National Iranian Gas Company (NIGC), LPG exports have increased 20% year-on-year, which would earn the country big hard currency revenue.