EU Countries Queuing Up for Iran’s Gas Supply

Informed sources disclosed on Wednesday that the member-states of the European Union (EU) are queuing up now to purchase Iran’s natural gas.
“A number of European oil and trade delegations, including some from the EU member-states, have visited Iran and held talks with senior oil industry officials to discuss import of Iran’s gas and also investment in industry,” an informed source, speaking on the condition of anonymity, told FNA on today.

He reiterated that the European delegations have discussed construction of gas pipelines for exporting Iran’s gas to Europe, and said, “In the negotiations, the two sides underlined that Iran has the capability to build pipelines and installations needed for transferring gas supplies and the Europeans are needed to invest in the project to expedite the work.”

Last month, Head of the Oil Ministry’s Committee for Oil Contracts Revision Seyed Mehdi Hosseini said that the Iranian Oil Ministry is negotiating with giant oil companies over investment in Iran’s energy sector, and the revised oil contracts will be presented in a gathering in London in the coming months.

“As planned, the revised contracts will be unveiled in the presence of representatives of all major oil and gas companies in London in September 2015,” Hosseini told FNA.

He noted that the outcome of the recent nuclear negotiations in Lausanne, Switzerland, will have positive outcomes for the conclusion of contract with foreign oil firms.

Mehdi Hosseini said the revision of oil contracts and removal of such obstacles as international sanctions are expected to persuade international oil companies to return to Iran’s energy sector.

He said enhanced oil recovery and transfer of the state-of-the-art technology are the most important elements for revising the oil contracts.

“We are benefitting from all experiences of the past in order to improve the structure of oil contracts while taking into account mutual benefits,” he added.

Hosseini said buy-back deals brought Iran’s oil production capacity to more than four million barrels a day and attracted tens of billions of dollars of investment in the oil and gas sectors.

In 1987, Iran’s parliament revised the Petroleum Law and finally buy-back contracts were defined.

Iran first signed buy-back deals in the 1990s when the country was still reeling from the destructive impacts of Iraqi war (1980-1988).

Last month, Iranian Foreign Minister Mohammad Javad Zarif announced Tehran’s preparedness to supply gas to the European countries.

“Iran on par with Russia enjoys all the (needed) resources to provide gas to Europe,” Zarif said in a joint press conference with his Kazakh counterpart Erlan Idrissov in Astana at the time.

Meantime, the Iranian minister stressed that his country does not at all intend to replace or rival Russian gas exports, and said, “Tehran is a trustworthy partner and this issue has been understood by China, India, Pakistan and Turkey which use Iran’s gas.”

Iran, which sits on the world’s second largest natural gas reserves after Russia, is making efforts to raise its gas production by increasing foreign and domestic investments, specially in South Pars gas field.

Since November 2013, when Iran and the six major world powers cut an interim deal over Tehran’s nuclear program, so many foreign countries have voiced their readiness to invest in Iran’s market.

Several European and Asian countries have dispatched high-ranking delegations to pave the ground for promotion of ties with Iran.

Now, all international investors are waiting for the moment when Iran and the Sextet of world powers cut a permanent deal which automatically will lift sanctions on Tehran economy.

July 2015 is the new deadline for the final nuclear agreement, but negotiators from both sides have voiced optimism over cutting the final deal even before the July deadline.