Greater Caspian Region Weekly Overview - October 11th
Iran
Details on Iranian gas production over the last six months
Iran increased sweet production by 4 percent to 82.2 billion cubic meters (bcm) during the first half of the current fiscal year, commencing on March 21, Iran Oil Ministry's information website Shana reported.
The country produced 178 bcm of sweet gas last year. Housing gas consumption triples in winter, which stands at 550 million cubic meters per day(mcm/d).
According to Iran Oil Ministry's statistics, the country's current gas production capacity (including flared and recycled gas) is 700 mcm/d, while sweet gas output capacity stands at about 550 mcm/d.
Iran is also planning to add 100 mcm/d refining capacity by late 2015, Shana quoted Abdolhossein Samari, the deputy head of the National Iranian Gas Company (NIGC) for operations affairs.
The country added 100 mcm/d of gas to production levels in 2014 to reach 660 mcm/d, while an additional 100 mcm/d production growth is planned by March 21, 2016.
Iran says the country's gas production would reach 1,100 mcm/d by 2020, and along with increasing gas production, the government is optimizing the gas consumer sectors to decrease domestic consumption by 50 mcm/d to pave the way for exporting 200 mcm/d of gas in four years.
Iran’s petrochemical products export exceeded pre-sanctions level
Iran’s petrochemical products export witnessed a significant increase in volume, but plunged in value during the last six months, Iran Custom Administration reported on October 9th.
During the first half of Iran's fiscal year, started on March 21st, the country increased petrochemical products export by more than 35 percent in volume, but the revenues decreased by 0.2 percent year-to-year. Petrochemical products export exceeded pre-sanction level during last six month.
Iran increased propane export by 43 percent in volume to 1.6 million metric ton, while the revenues decreased by 24 percent to $815 million. Butane export also increased by 20 percent in volume to 962,000 metric tons and declined by 35 percent in value to $505 million.
Methanol export decreased by 2 percent in volume to 2 million tons, but almost halved in value to $541 million.
Iran ready to increase gas export to Turkey
Iran is ready to increase gas export to Turkey, the director of international affairs at National Iranian Gas Company (NIGC) Azizollah Ramezani announced on October 10th.
Ramezani said that regarding Turkey’s appeal to the International Court of Arbitration (in 2012), charging Iran about selling gas at high price, Iran is negotiating with Ankara to resolve the dispute.
Iran exported 9.7 bcm of natural gas to Turkey during last year. Previously, Iran announced that it is ready to propose a discount if Turkey agrees to increase more Iranian gas, but Ankara rejected.
Iran reportedly sold 1000 cubic meters of gas to Turkey at $490 in 2012, which is expected to decrease due to a halving in oil prices in global markets.
Turkey reportedly asked for a 25-percent discount in Iranian gas price.
Azerbaijan
Azerbaijan’s gas production plunges in August
According to a new report released by the State Oil Company of Azerbaijan (SOCAR) on October 10th, the country’s total gas production decreased from 2.468 bcm in July to 1.844 bcm in August.
Around 18.99 bcm of gas were produced in Azerbaijan from January-August 2015, 7.1 percent less than the same period last year.
SOCAR produced 4.58 billion cubic meters of gas fom January-August 2015, indicates a 7.7 percent decrease year-to-year.
Azerbaijan produced 29.62 bcm of gas in 2014 compared to 30.78 bcm in 2013.
TANAP could reduce share of Russian gas in EU to 25-28%
Implementation of the Trans Anatolian Pipeline (TANAP) and an increase in the spot deliveries of liquefied natural gas (LNG) could reduce share of the Russian market in the EU to 25-28%, Hossein Adelie, General Secretary of the Gas Exporting Countries Forum (GECF), said in his interview to Izvestiya Russian newspaper.
“Right now one third of gas consumed in EU comes from Russia and as soon as TANAP is launched and the LNG spot deliveries increase, the share will go down to 25-28%, but no more than that,” the newspaper quotes Adelie on October 6th.
Adelie believes that Azerbaijani gas supplies to the EU will begin no earlier than in 2022-2025, while the supplies of Iranian gas will begin even later.
“They could replace only several percent of the current consumption of Europe. Not only GECF, but also the EU understands that. We believe that Russia will continue occupying dominating position at the EU market,” he said.
Iran would like a stake in liquefied natural gas, because it is better for it to export gas to Asia through the Arabian Sea. The Iranian gas pipeline through Turkey is a long-term project and there are no preconditions for it yet, Adelie added.
The TANAP project envisages construction of a system of gas pipelines from the Azerbaijani Shah Deniz field to the south of Italy through Georgia, Turkey, Greece and Albania. 6 bcm/y of gas is planned to be exported via them to Turkey and 10 bcm/y of gas to Europe. In the future the gas pipeline capacity could be increased up to 31 bcm/y. Construction of the gas pipeline started in March 2015.
SOCAR ready to compete with Gazprom in Georgia
The State Oil Company of Azerbaijan (SOCAR) is ready for competition with Gazprom on the Georgian market, Mahir Mammadov, head of SOCAR Energy Georgia exclusively told Trend on October 9th.
SOCAR Energy Georgia is a subsidiary of SOCAR in Georgia.
Earlier, a working meeting was held between the Chairman of the Board of Gazprom Alexey Miller and Georgia’s Minister of Energy and Natural Resources Kakha Kaladze in Brussels.
During the meeting, the sides discussed the cooperation in gas sphere. They were talking about the supply of Russian natural gas to Georgia, as well as its transit to third countries.
The possible growth in Russian gas supply to Georgia will increase the competition on country’s market, according to Mammadov.