China Sets Eyes on Iran’s $20 Billion Gas Market

Chinese companies have start negotiating with the National Iranian Gas Company (NIGC) for implementing projects after the lifting of the sanctions against the Islamic Republic.

NIGC managing director Hamid Reza Araqi said that the Chinese companies have been negotiating on gas transfer projects using build-operate-transfer (BOT) and build-own-operate (BOO) methods, as well as technical and engineering services, Shana news agency reported on November 16.

Meanwhile, talks with European companies are underway, Araqi said, adding that the presence of foreign companies in the country’s gas market will enter a new phase once the Joint Comprehensive Plan of Action (JCPOA) reached between Iran and world powers takes effect.

There is a capacity for investing $20 billion in the Iranian gas projects, he said. Currently, packages of investment in gas refining, storage, and transfer are prepared.

“Investment and technology transfer are the highest priority in negotiating with foreign companies," the official said. "For the time being, purchasing goods is not on the agenda.”

Last week, Iran announced that it has introduced $18 billion worth of petrochemical projects to be financed by Chinese. Iran also says it is eyeing gas export to China.

Azizollah Ramezani, the National Iranian Gas Company (NIGC)’s director for international affairs, says Iran should take its real share of the global gas market over the next 10 years after the lifting of sanctions against the country. 

Iran and the P5+1 (the U.S., UK, France, Russia, China plus Germany) reached a nuclear deal on July 14th, which paved the way for the elimination of sanctions on Iran by late 2015, including a gas import ban by the EU.