LONDON (Reuters) - Europe's ban on Iranian oil, aimed at piling pressure on Tehran, may end up breathing new life into the country's aging oilfields, Western and Iranian oil experts said on Friday.

 

If Iran were forced to shut in any - or all - of some 500,000 barrels per day (bpd) of supply that would have gone to customers in the European Union, such a move would help rejuvenate, not harm, the Islamic Republic's oil reservoirs.

 

There is a widespread expectation among oil traders and shipping brokers that Tehran will float much of the displaced European oil on tankers, because it does not want to shut in output and wreck the reservoirs.

 

But in actual fact, slowing Iran's current production of 3.5 million bpd would be the best thing for its overworked reserves, say veteran geologists. And in the short term, the National Iranian Oil Co (NIOC) may end up doing just that while it works to re-route the oil.

 

"Iran can shut in 10 to 20 percent of its production without damaging the reservoirs: in fact, it will do them some good," said Peter Wells of geological consultancy Neftex Petroleum. "If it's done properly, shutting in the oilfields should be beneficial as it allows the pressure to build back up."

 

Wells has first-hand knowledge of Iran's oilfields through his work with Lasmo, now part of Eni, which has invested in the country. He was confident that Iranian engineers would be up to the task, because they have closed down parts of their fields before for routine maintenance.

 

"If pushed, Iran could shut in about 500,000 barrels a day without doing any harm," said Mehdi Varzi of UK-based Varzi Energy. "But if a forced shut in were to drop output below 3 million, there could be problems in certain fields," said the former NIOC official.