PRESS COMMUNIQUÉ ON INDIA – IRAN HYDROCARBON SECTOR COOPERATION
In a bilateral meeting today in New Delhi between the Hon’ble Minister of Petroleum & Natural Gas of India, Shri. Mani Shankar Aiyar and H.E. Mr. Bijan Zangeneh, Minister of Petroleum of Iran, it was agreed to further the mutual cooperation between the two countries in the hydrocarbon sector in a big way. In addition to concluding the details of the long pending package comprising of LNG imports from Iran and participation of Indian companies in Iranian oilfields, it was agreed to deepen further the relationship between the two countries.
2. As regards imports of LNG from Iran, GAIL and IOC signed an agreement with M/s NIGEC (National Iranian Gas Export Corporation), to import 7.5 MMTPA of LNG for a period of 25 years beginning 2009. On the issue of participation of Indian companies in Iranian oilfields, an MoU was entered into by OVL with NIOC as per which Indian oil PSUs, led by OVL, would participate in Yadavaran field (20% participation equivalent to 60,000 barrels per day) and Jufeyr field (around 30,000 barrels per day) in Iran through service contracts.
3. The following was further agreed:
(i) IOC had signed an MoU with M/s Petropars for developing an upstream block in South Pars gas field and setting up of LNG liquefaction facilities with 9 MMTPA capacity in Iran. IOC and M/s Petropars would submit a joint proposal to NIOC by the end of February 2005 for the award of the project. The Iranian side agreed for a favorable consideration of the proposal.
(ii) IOC – EIL Combine had submitted a bid for upgradation of Tehran and Tabriz refineries. The original condition of the bid required a crude swap arrangement between the Caspian crude and Iranian crude for financing the project. However, in view of the changed situation in the world oil market, arranging financing through such swap arrangement has not been found workable. Thus, it was decided that IOC – EIL would submit an alternative financing proposal, which would be favorably considered by the Iranian side.
(iii) There is great potential for mutual investments by India and Iran in the petrochemical sector. NPC has offered IOC participation in their 12th Olefin complex, under implementation at Bandar Assaluyeh. The Iranian side further offered to the Indian companies the opportunities for investments for producing fertilizers, ethylene, methanol, ammonia, etc., in Iran. The Indian companies agreed to examine and submit appropriate proposals in this regard.
(iv) The Iranian side suggested investments for setting up of energy intensive projects viz., producing aluminum, cement, steel, etc. in Iran. The Indian side agreed to further examine the possibilities.
(v) The Iranian side invited investments in gas condensate refineries and super heavy oil refineries in Iran. It was agreed that IOC would look at these proposals for taking a view.
(vi) ONGC requested participation in the whole gas value chain, starting from E&P to downstream gas processing, alongwith Iranian companies. They would be making a detailed proposal for taking up a block in South Pars field. The Iranian side agreed to favorably consider such proposal.
(vii) GAIL has signed a MOC with Iran Fuel Conservation Organization (IFCO) for cooperation in CNG related opportunities. During the meeting, GAIL proposed for making investment for developing CNG infrastructure in Tehran and Esfahan. The Iranian side agreed to favorably consider the proposal.
(viii) EIL suggested that based on their experience/expertise in ethylene and C2/C3 liquefaction, they may be considered by the Iranian side for PMC services for LNG projects. The Iranian side suggested that EIL may like to come jointly with reputed firms for LNG projects and they could consider the same in case the same is acceptable to investment bankers dealing with such projects.