Iran rejects selling LNG shares to foreign companies

A senior energy official has dismissed reports that Iran planned to sell its shares in the country’s frontrunner LNG scheme to foreign companies.

The rebuttal on Wednesday by Managing Director of National Iranian Gas Company Alireza Kameli came after another official was quoted as saying that NIGEC planned to sell at least 20% of its 49% shares in Iran LNG project.

“The National Iranian Gas Company has no plan for tendering shares of its LNG production projects to foreign investors and oil companies,” Kameli was quoted as saying by the Mehr news agency.

Along with Iran Oil Pension Fund which holds the remaining 51%, NIGEC hopes to complete Iran LNG in just under three years, General Manager of marketing at NIGEC Mostafa Sharif was quoted as saying recently.

Iran LNG was among three liquefied natural gas production projects which the country planned to operate with the help of Royal Dutch Shell and Total.

Two of the projects – Pars LNG and Persian LNG – were halted after sanctions were imposed on Iran in 2012, “but Iran LNG is being completed because its investors were Iranian companies and funds”, Kameli said.

“In consideration of this progress, the completion and commissioning of this plant has high economic viability under the existing conditions,” he added.

With more than 34 trillion cubic meters under its belt, Iran owns the world’s largest natural gas reserves but its share of the global trade in gas is less than one percent. Officials hope to attract $40 billion in the gas industry now that sanctions are lifted.

Iran seeks to raise gas production to 1.2 billion cubic meters (bcm) a day in five years, from 800 million cubic meters now. Annual output totals 166 bcm, which is mostly used at home.

German industrial gases group Linde has already offered to help Iran complete its LNG projects.

Foreign companies are also weighing $800 million-$1 billion of investment in floating production of LNG from associated gas at offshore fields in the Persian Gulf, a senior energy official has said.

Last November, Minister of Petroleum Bijan Zangeneh said Iran and Belgium were in talks for possible FLNG production off the Kharg Island.