(MEBG) - The ENI Group has been present in Iran since 1957 when a joint company, Societé Irano-Italienne des Petroles (SIRIP), was established between Agip and The National Iranian Oil Company (NIOC). In 1979, following the islamic rrevoltion, all foreign interests in the oil sector were nationalized. However, today Iran is looking for external investments in its oil, gas and petrochemical fields. This has made ENI’s re-entry to the much easier.
Oil & Gas Exploration
ENI and Iran were due to sign two new gas accords, on July 2000, with a total value of $4.3 billion. The accords cover the development of gas deposit zones with a total area of 3,700 square km, located some 100 km into the Arabian Gulf, off the coast of Qatar. The deposit is estimated to contain about 10 trillion cubic meters of natural gas and is expected to increase Iran's daily gas production by nearly 14 million cubic meters.
In March 1999 ENI, through its subsidiary Agip Dorood B.V., and the French oil company Elf Aquitaine, ENI signed a contract with NIOC for the redevelopment of the Dorood field, located mainly in the offshore of Khargh Island (Persian Gulf).
Elf Petroleum Iran (55 percent), the operator, in association with Agip Dorood B.V. (45 percent) will carry out the redevelopment work , which should increase reserves from 600 million barrels to 1.5 billion barrels of oil. This contract is on buy back basis under which the Elf/Agip will be paid in oil produced from the field for 10 years. Production is expected to be up to 220,000 bpd, Capital expenditure estimations at about $540 million.
Agape/Elf also is in position to deal on Darkhovin field and South Pars fields on a buy back basis. Expected investment in this onshore field in about $600 million. Agip will have 55 percent share in that venture and will be the operator. The negotiations begun at 1999, after international tender.
It is expected that Iran to provide at least one more oil development contract. The CEO of ENI said that Iran is a rising country in the oil sector.
Iran has the second largest natural gas reserves in the world, and has huge oil reserves. Iran’s total oil and oil capacity production is far below its potential, and it is looking for foreign investments to help her develop her oil and gas sector.
Engineering & Petrochemical services:
In the engineering and contracting services sector, Snamprogetti and Saipem carried out several projects, such as the Shiraz Refinery, the Tabriz Refinery, the Marun-Esfahan Crude Oil Pipeline and the Marun-Esfahan-Rey Pumping System.
Saipem's activities in Iran also include the construction of Sections I and II of the IGAT II (from Khangan to Isfahan), six rich gas compression plants at Marun, an oil pipeline from Gurreh to Taheri and the Arak Refinery. Saipem, in joint venture with other partners, also carried out construction activities related to the Khangiran Gas Gathering System and Gas Treating Plant.
Snamprogetti also provided engineering services for the Second Iranian Gas Trunkline (IGAT II) and engineering and materials supply services for the Arak Petrochemical Complex and the Esfahan Linear Alkyl Benzene Plant. In a joint venture with another partner, Snamprogetti carried out a grass-root large refinery at Bandar Abbas providing engineering services and material supply.
© 2000 Mena Report (www.menareport.com)
