Iran Signs $2bln Oil Deal with China

A02469547.jpgTEHRAN (Fars News Agency)- Iran signed a $2bn oil contract with Sinopec of China Sunday, sending a signal to western companies that they might miss out on potentially lucrative contracts with one of the world’s biggest energy exporters if they continued to heed US-inspired sanctions against Tehran.

“If other countries who like to invest in oil and gas hesitate, they will lose opportunities,” said Iranian Oil Minister Gholam Hossein Nozari.

The contract to partly develop the giant Yadavaran oil field in south-west Iran is one of the biggest Tehran has signed and is the first with a Chinese company.

“Implementation of the contract will start immediately,” Nozari said.

Iran sits on the world’s second largest oil and gas reserves and it has decided to attract enough investment for its development projects.

Yadavaran is estimated to contain 12bn-18bn barrels of oil. The contract involves production of only 85,000 bpd by the time the field is developed in four years. The second phase, to produce another 100,000 bpd, will be decided later.

Sinopec is obliged to give 51 per cent of its sub-contracts to Iranian companies.

Nozari also said Iran had signed multi-billion dollar contracts with some other nonwestern companies to develop two major upstream oil fields a few months ago.

France’s Total, Royal Dutch Shell and Spain’s Repsol YPF have been negotiating to develop some parts of South Pars, the world’s biggest gas field. Iran has given them an ultimatum that it could wait only until June 2008.

Check Also

Why Iran’s New President Won’t Change His Country

Masoud Pezeshkian Will Not Cross the Supreme Leader On July 5, the parliamentarian Masoud Pezeshkian …