By Ebrahim Fallahi

Iranian oil industry shining bright despite sanctions shadow

September 25, 2021 - 14:4

TEHRAN – Iranian oil industry has once again proved the west to be miscalculating in its efforts for crippling the country’s move toward development as the local developer of the Azar joint oil field project has won the International Project Management Association (IPMA)’s Global Project Excellence Management Award in the mega projects section.

Sarvak Azar Engineering and Development Company (SAED), owned by the Petroleum Retirement Fund, which is in charge of the Azar joint field as one of the most complex oil fields in the country, won the gold medal in IPMA Global Award for Project Excellence Management in a ceremony held in Saint Petersburg on Wednesday.

Winning a gold medal in this global competition has been realized in a situation when the U.S. sanctions have cut the Iranian oil industry’s ties with the global market and pushed domestic firms to grow technologically at an unbelievable pace to meet the industry’s needs.

This year, evaluation of various international projects based on the IPMA PEB model was carried out virtually by six international evaluators from Poland, the United Kingdom, the Netherlands, Kazakhstan, Nepal, and China.

Achieving this success is an indication of the Islamic republic’s potential and capacities in the oil and gas sector and shows how far the country can rise despite the weight of harsh sanctions pulling it down.

Azar, one of the joint fields shared with Iraq, spans an overall area of 482 square kilometers in southeast of Mehran town in the western Iranian province of Ilam.

The field is estimated to hold 2.5 billion barrels of oil in place. The volume of possible oil reserves to be extracted from the Azar field is estimated to be around 400 million barrels.

Back in July 2017, Russia’s Gazprom signed a cooperation agreement with Iran's Oil Industries Engineering and Construction Company (OIEC) over the development of the oil field. In December 2017, the two companies submitted their joint plan to the National Iranian Oil Company (NIOC) to develop the field. The Russian company, however, left the project in early 2018, and OIEC took over.

As there are still no processing facilities installed at the place of this field, its output is going to be sent to the processing facilities of Dehloran oil field through a 120-km pipeline.

In January, the OIEC Managing Director Gholamreza Manouchehri said the field reached its full capacity in the first development phase, producing 65,000 barrels per day (bpd) of oil. Under the first phase plan, 18 wells have been drilled in the field.

Pointing to the Azar field’s complex geological conditions, the official had said: "The complexity of the field had made its development very difficult, and international companies that had previously done the exploration work in this field, believed that only they would be able to develop this field.”

“However, domestic companies took over the development of the field, and both financing and implementation were successfully done by capable Iranian companies.”

According to Manouchehri, the production from the field began in February 2017 with a daily production of 15,000 barrels.

“This figure reached 30,000 barrels per day in 2018, and now the production of this joint field has reached 65,000 barrels per day, which is very significant.”

The major part of the project's financial resources came from the National Development Fund (NDF) and the rest was supplied by OIEC, he said.

Manouchehri mentioned the conducting of performance tests in this field, saying all the wells and facilities of the field’s first development phase have been put into operation since December 14, 2020, to be tested for potential problems.


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