Bitterness towards old concessionaires who “exploited” it lingers to influence public opinion today, he said. “Foreign operators need careful diplomacy by their management and staff,” said London-based oil expert Manouchehr Takin.
Companies in this position needed to emphasise the expertise, not the nationality, of the mother company, he said.
Takin cited several examples of oil fields in Iran still capable of producing large quantities of hydrocarbons despite advanced age. He said they were in the position of being “capital intensive” and ‘expert intensive.’
“Many have passed their peak and are in decline, although they still hold about 30bn barrels of recoverable reserves,” he said, the equivalent of the oil reserves of Kazakhstan, which produces 1.6m barrels per day (bpd).
Producing this oil would require detailed field monitoring, reservoir analysis, and IOR and EOR techniques. Average well production had fallen to 2,500 bpd, from 16,000 bpd in the 1970’s.
Takin said Iraq, Kuwait, Saudi Arabia and the UAE were in a similar situation.
By comparison, he cited the Forties Field in the UK North Sea at which production peaked in 1978 at 520,000 bpd. BP sold the field to Apache Corp. in 2003 after production had fallen to 40,000 bpd, and the field had produced 2bn barrels. BP then estimated a field decommissioning date of 2013.
By 2013, Apache had turned the field into the second-largest producing field in the sector, after the Nexen-owned Buzzard platform, and it is expected to go on delivering oil well after 2030, 20 years later than 2003 estimates.
In addition, several shared oil and gas fields was a national priority but ‘oil policy’ and ‘political’ differences with neighbouring countries made joint operations difficult in several cases, Takin said.
Patrick Murphy, a partner at Clyde and Co in Dubai, said the lifting of sanctions against Iran would not mean that American persons or entities would be able to do business in Iran for several years, due to a more complex layer of restrictions dating back to the 1990’s and before.
“US sanctions on US persons are all going to stay in place,” he said, although he did concede that commercial entities up to 10% US owned could be able to trade there.
The conference also heard that it was likely that Iranian oil and gas companies would go for new-generation OSV technology, after one speaker suggested they might prefer to select legacy vessels due to preferable pricing dynamics.
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