A New Record in Iran’s Autumnal Gas Consumption

As the Iranian government has accelerated development of several upstream gas projects to increase the output by 100 million cubic meters per day by winter, the consumption rate broke a new record in autumn, increasing by 100 million cubic meters per day (mcm/d) on November 9th compared to the same day in last year.

The Middle Eastern country’s gas consumption reached 520 mcm/d on Nov.9, which of 362 mcm/d was consumed in the housing sector, according to the National Iranian Gas Company’s (NIGC) spokesman Majid Boujarzadeh, speaking to Shana News Agency on November 10th.

The report says that about 86 mcm/d and 70 mcm/d of gas were delivered to big industrial sectors and power plants respectively.

The figures indicate that Iran has decreased gas delivery to power plants significantly compared to the last months due to a huge increase in the gas consumption of housing sector.

Iran sits on 33.6 trillion cubic meters of natural gas reserves; ranks the first in the world, but has faced gas shortage in winter during last years due to long delays in upstream projects as well as huge increase in domestic consumption growth rate.

Gas production

Iran’s refined natural gas production was about 485 mcm/d during last year, but the figure reportedly increased by 52 mcm/d in 2014 by starting early production from phase 12 of giant South Pars gas field and central oil fields, according to the Oil Ministry’s official data. However, the British Petroleum put Iran’s gas production level at 456.4 in 2013, excluding gas flared or recycled.

South Pars is the world’s biggest gas field with about 33 trillion cubic meters of gas reserves which is joint between Iran and Qatar. Iran divided its sector to 24 phases, 10 of them had been commissioned until 2009. Iran was producing about 245 mcm/d of refined gas from phases 1 to 10, but boosted the gas output by launching the first platform (12A) of phase 12 to 25 mcmpd until July 2014.

Rokaneddin Javadi the managing director of National Iranian Oil Company told IRNA on Oct.20 that another two platforms (12B and 12C) of phase 12 will be installed in December 2014 and Feburary 2015 to increase the output of Phase 12 to about 65 mcm/d. On the other hand, Iran is preparing to commission two platforms of phases 15 and 18 of South Pars (15A and 18A) to start 12.5 mcm/d of early gas production from these phases until the winter.

Iran also increased has production in central oil fields (associated gas) by 27 mcm/d, the Iranian Central Oil Fields Company (ICOFC) announced on November 2nd.

In total, Iran has increased gas production level to about 537 mcm/d so far and this figure can reach about 590 mcm/d in winter if the new platforms of South Pars become operational.

Gas consumption

The soar in Iran’s gas consumption by 100 mcm/d to 520 mcm/d in November 9th happened while the average weather temperature in the country was similar to the same day the previous year. During last winter, Iran’s gas consumption in the housing sector reached to 485 mcm/d in some weeks, which led to gas shortage in other sectors. Iran had to cut has delivery to power plants, petrochemical and CNG producing units as well as gas injection to old oil fields.

In addition to cutting gas supplies to power plants, which led to burning $30 billion of liquid fuels, the Iranian government had to decrease gas delivery to petrochemical plants from 35 mcm/d in summer to 15 mcm/d in winter during last year. This caused a drop in the petrochemical production by 7.5 million tons during the last fiscal year.

On the other hand, Iran cut gas supply to CNG production plants from 19 mcm/d to zero during the last winter, which caused gasoline consumption to soar to about 70 million liters per day in average during last fiscal year.

However, earlier, on October 20th, the Managing Director of National Iranian Gas Company (NIGC) Hamid Reza Araqi said that during first half of current fiscal year (Iran's fiscal year starts on March 21, simultaneously with beginning of spring), some 33 bcm (about 180 mcm/d) of gas was delivered to power plants, 7.7 bcm more than the same period last year.

The statistics of gas delivery to power plants on November 9th indicates that natural gas supplements to power plants has been decreased by 62 percent compared to spring and summer. Iran is projected to deliver only 50 mcm/d of gas to this sector in winter.

Iran has also two gas storage facilities. Iranian government said on Oct.27 that some 2 billion cubic meters of gas has been stored in Serajeh and Shourijeh facilities to be used in winter.

Though Iran increased gas production, it seems Iran still will face gas shortage in next years due to high consumption growth rate.

Iran hasn’t commissioned any new oil field since 2007 and about 80 percent of the country’s oil fields are in their second half-life and needs about 290 mcm/d of gas injection to prevent more crude output decline, but Iran delivers only about 77 mcm/d into oil fields.

Below is Iran's fossil energy carriers consumption per day according to the data derived from National Iranian Oil Refining and Distribution Company’s (NIORDC) annual reports. (Iran's fiscal year begins on March 21).

** including gasoline, oil-gas, kerosene and fuel oil

Dalga Khatinoglu