China invests $40 billion in Iran’s energy sector

August 1, 2010 - 0:0

TEHRAN -- Chinese companies have invested around 40 billion dollars in Iran's oil and gas sector, the Iranian deputy oil minister said in Tehran on Saturday.

Hossein Noqrehkar-Shirazi also stated that Tehran's oil exports to China fell by 30 percent in the first half of 2010 compared with the corresponding period last year.
“The volume of Chinese investment in upstream oil and gas projects is 29 billion dollars,” Noqrehkar-Shirazi told the Mehr News Agency, adding that Beijing had signed contracts worth another 10 billion dollars in petrochemicals, refineries and oil and gas pipeline projects.
The Iranian minister said China has also put forward proposals to participate in building seven new refineries in the Islamic Republic.
Noqrehkar-Shirazi said that Chinese imports of Iranian oil fell in the first half of the year.
“Although Iran is still among top 10 oil exporters to China, it is the only country which in the first six months of 2010 has seen its exports to China falling,” he said.
“The volume of oil exports to China in the first six months of this year decreased to less than 9.02 million tons or 66.12 million barrels. This shows a 30 percent decrease” over the first half of 2009, the minister stated.
He added that the two countries are to start a new round of talks on developing bilateral oil trade and exchange, Press TV reported.
Another Iranian Deputy Oil Minister Alireza Zeighami said earlier in July that Chinese companies have offered to finance some of the country's oil refinery development and gasoline production projects.
“Chinese companies are currently involved in building the Arak oil refinery; we intend to expand our cooperation with different Chinese firms for other oil refinery projects in Iran,” Zeighami said.
In recent years, China has filled the gaps in Iran's energy sector left by Western firms forced out by international sanctions, according to AFP.
In 2009, China became Iran's premier trading partner, with bilateral trade worth 21.2 billion dollars against 14.4 billion dollars three years earlier.
Commercial ties between the two countries were almost non-existent 15 years ago, amounting to just 400 million dollars.
China backed the fourth set of UN sanctions against Iran over its civilian nuclear program, but Beijing has consistently urged the world powers to resolve the crisis diplomatically.
On Friday, it also opposed the latest unilateral sanctions on Iran imposed by the European Union.
Iran’s oil reserves rank third-largest in the world at approximately 136 billion barrels as of 2007, although it ranks second if Canadian reserves of unconventional oil are excluded. This is roughly 10 percent of the world's total proven petroleum reserves. Iran is the world's fourth-largest oil producer and is OPEC's second-largest producer after Saudi Arabia.
Iran has the world's second-largest reserves of natural gas (15 percent of the world's total). It contains an estimated 974 trillion cubic feet (Tcf) in proven natural gas reserves. About 62 percent of these reserves are located in non-associated fields.