Iran Prods CNPC on South Pars Development

Iran has warned China's CNPC, that it will re-assert control over South Pars development if investment in phase 11 of the giant offshore gas field is not ramped up.

Rostum Qasemi, recently appointed Oil Minister by Mahmoud Ahmadinejad from the Revolutionary Guards, said last week that the Guard’s engineering wing that he used to run, Khatam al-Anbia, should take over the running of the country’s hydrocarbons resources and no foreign contractors were needed.

"If the current trend of the development of South Pars phase 11 continues, it is also possible that the whole contract be ceded to powerful domestic contractors," Qalebani said, according to Mehr.

Iran has the second largest natural gas reserves in the world after Russia, but sanctions over its disputed nuclear programme and other factors have slowed its development as a major exporter. The offshore South Pars field, the world's largest reservoir of gas, contains about half of the estimated 28 trillion cubic metres of the country's gas reserves.

Iran said last year that production at South Pars rose by nearly 30% during 2009-10 and that the field is expected to generate state income of up to $130 billion per year.

Source: Neftegaz