GREATER CASPIAN REGION WEEKLY OVERVIEW - SEPTEMBER 6th
Iran
Iran preparing to develop new gas field in northeast region
Iran is preparing to start development of Tus gas field, places in northeastern regions, close to Turkmenistan borders.
Mohammad Mam Beigi the managing director of East Oil & Gas Production Co. (EOGPC) told Shana on September 1st that producing 3 million cubic meters per day (mcm/d) to 4 mcm/d of gas was projected from this field. This field would be active for seven consecutive years.
He also said that with production recovery and maintaining operations, the Khangiran gas field close to Tus field can keep the production level at the current level of 45 mcm/d by 2025.
Excepting Khangiran, Iran currently produces gas in northeastern regions only from Ghonbadli gas field. This field is joint between Iran and Turkmenistan and two neighbors produces about 0.7 mcm/d of gas from this field together.
Iran’s northeastern regions rely heavenly on gas import from Turkmenistan.
Turkmenistan is obligated to support Iran with 14 bcm of gas per annum (bcm/a) –or nearly 40 mcm/d- through two pipelines: the Korpeje-Kordkuy route which was commissioned in 1996, and the Dauletabad-Sarakhs-Khangiran pipeline which came on stream in 2010. The total capacity of pipelines is about 20 bcm per year. However, Ashgabat delivers only 6 to 7
Iran also have a plan construct 11th cross-country pipeline to transit 110 mcm/d of South Pars gas to northeastern regions.
Iran ready to expand IP Pipeline towards Bangladesh
Iran is ready to expand the Iran-Pakistan pipeline towards Bangladesh.
According to a report, released by Dhaka Tribune on September 2nd, Iranian Ambassador to Bangladesh Abbas Vaezi said Iran had negotiated the project with Pakistan and India, and it could definitely be extended to Bangladesh.
Iran has already constructed the 7th cross-country pipeline towards Pakistan borders, but Islamabad hasn’t started piping in its soul despite its obligation to intake 22 mcm/d of Iranian gas until January 2015.
Iran is talking with India and Bangladesh to expand the pipeline and sell its gas to these countries through Pakistan.
$60 Bln invested, more $20 Bln to be put in South Pars
Some $60 billion investment has put on South Pars so far, while more $20 billion investment is needed to develop the remained phases.
According to Iranian Oil Minister Bijan Namdar Zanganeh, 25 phases of South Pars gas field would become operational by 2018 and the country’s total gas production would reach 1,000 mcm/d.
Currently phases 1 to 10 produces with full capacity (each phase produces 25 mcm/d), while the production capacity of phase 12 is 75 mcm/d. Phases 15, 16, 17 and 18 work with half capacity and the phase 19 is expected to start early production by March 2016.
Iran produces 400 mcm/d of gas from South pars and the figure will double by full operational of this giant field which contains 14 trillion cubic meters of gas in Iranian side.
South Pars is joint between Iran and Qatar.
Drillings in South Pars phase 19 almost completed
Drilling operations in South Pars phase 19 have been completed by 99.44 percent, Hamid Reza Masoudi the managing director of Phase 19 project told Shana on September 6th.
He said that the overall development of phase 19 reached 87.67 percent so far and Iran attempts to commence this project in winter, though the phase 19 is planned to become operational in March 2016.
Iran has drilled 21 wells in phase to produce 25 mcm/d of gas.
Masoudi said that his company is trying to start producing 14 mcm/d of gas from this phase in winter, then increase the output volume in future.
A consortium, composed of Petro Pars limited, Petro Pars Iran and IOEC signed an Engineering, Procurement, Construction (EPC) contract with Iran’s Pars Oil and Gas Company in 2000.
Soaring gas delivery to power plants makes Iran a diesel exporter
Soaring gas deliveries to power plants made an opportunity to Iran to not only stop diesel import, but become a diesel exporter.
Iran exports 34 million liters of diesel in a month, Mehr News Agency reported on August 5th.
Iran’s diesel consumption level was 104 million liters per day during last years. The country was importing above 460,000 liters of diesel in 2013, while this figure reached 840,000 in 2014.
However, the country stopped diesel import since early 2015.
The main cause is replacing natural gas with diesel as fuel usage in power plants.
According to Iran’s Energy Ministry’s official statistics, diesel consumption in Iran’s power plants decreased by 37 percent to 1.7 billion liters in first five months of current fiscal year, stated on March 21th.
Azerbaijan
Azerbaijan, Turkmenistan, Turkey to discuss Trans-Caspian pipeline
Azerbaijan, Turkmenistan and Turkey intend to discuss the prospects of the Trans-Caspian gas pipeline construction.
The negotiations are planned to be held at a high level in Turkmenistan this autumn, a source close to the negotiations told Trend.
Proceeding from the Turkmen media, the issue has been recently discussed at the governmental meeting.
"While discussing the preparation for the forthcoming trilateral meeting, Turkmen President Gurbanguly Berdimuhamedov stressed its importance for the further strengthening of the traditional relations of friendship and mutually beneficial partnership among the three countries and nations," Neutral Turkmenistan newspaper wrote Sept. 5.
Trans-Caspian gas pipeline is aimed at delivering Turkmen gas to Turkey (TANAP) or AGRI LNG project through Azerbaijan.
SOCAR, Petronas sign memorandum of understanding
The State Oil Company of Azerbaijan (SOCAR) and Malaysian Petronas company have signed an addendum to the memorandum of understanding, SOCAR said.
The signing ceremony took place during the visit of a delegation led by the president and chief executive officer of Petronas company Datuk Wan Zulkiflee Wan Ariffin in Baku, Sept.3.
At a meeting with SOCAR president Rovnag Abdullayev, Datuk Wan Zulkiflee Wan Ariffin expressed interest in intensifying the cooperation with SOCAR.
Abdullayev said that the oil and gas industry of Azerbaijan has great opportunities for developing the cooperation and security of the investments made in the country is fully guaranteed.
Abdullayev spoke about the process of implementing the Shah Deniz-2 project and creating the Southern Gas Corridor, stressing that the work is being conducted on schedule.
"The conducted work gives confidence that the first gas supplies through the Southern Gas Corridor to Turkey will begin in 2018," Abdullayev said.
Currently, Petronas has a 15.5 percent share in the Shah Deniz field development project and the South Caucasus gas pipeline. It also owns a 12.4 percent stake in the Azerbaijan Gas Supply Company.
Petronas redeemed these shares from Norwegian Statoil, which announced its decision to sell a 20 percent stake in the Trans Adriatic Pipeline, estimated at about $ 400 million. Malaysian Petronas is an obvious candidate for participation in this project.
TAP’s shareholding is comprised of BP (20 percent), SOCAR (20 percent), Statoil (20 percent), Fluxys (19 percent), Enagás (16 percent) and Axpo (5 percent).
The Southern Gas Corridor is a project that will enable Europe to diversify its sources of hydrocarbon supply and boost energy security and Azerbaijan - to get a new market in Europe.
Kyrgyzstan
Kyrgyz President Almazbek Atambayev within the framework of his working trip to Beijing, met with Chinese leader Xi Jinping. Following the meeting, 3 documents were signed and 1 program was adopted.
Thus, Program of cooperation between Kyrgyzstan and China in 2015-2025.
The program covers every area of bilateral cooperation, a source in the presidential press service has told Interfax.
It’s expected the construction of Turkmenistan-Uzbekistan-Tajikistan-Kyrgyzstan-China gas pipeline was included in the signed agreement.
In September 2013, China signed inter-governmental agreements with Uzbekistan, Tajikistan, and Kyrghyzstan respectively on Line D project (A branch of Central Asia-China gas pipeline). On September 13, construction of the Tajikistan section of Line D started. Totaling 1,000km with 840km outside China, Line D has a designed annual deliverability of 30 billion cubic meters, and is routed via Uzbekistan, Tajikistan and Kyrgyzstan to China. Upon the operation of Line D, the Central Asia-China Gas Pipeline will have an annual deliverability of 85 billion cubic meters, the largest gas transmission system in Central Asia.
Kazakhstan
Kazakhstan,China signed $23 Bln agreements
During Kazakh President Nursultan Nazarbayev’s visit to China, Kazakhstan and China signed 25 agreements worth $23 billion that aim at moving bilateral cooperation from raw materials sectors to processing industries and manufacturing products with higher added value, the Kazakh presidential press service said on September 1.
According to Nazarbayev, they agreed on the creation of 45 joint facilities and signed 25 documents.
The meeting was attended by representatives of the major Chinese companies, including Sinopec, CNPC, Huawei, Citic and others.
Kazakhstan Petrochemical Industries (KPI) and its general contractor Sinopec Engineering (Group) Co. Ltd. have terminated an engineering, procurement and construction contract for a the 1st phase of polypropylene production (PP) plant in Atyrau, according to information of Sinopec Engineering published on its corporate website on November 2014.
Tethys Kazakhstan SA, a subsidiary of Tethys Petroleum Ltd., has signed an MOU with PetroChina International Kazakhstan Ltd. In May to explore the feasibility of a long-term and mutually beneficial cooperation in natural gas and crude oil deliveries.
The main collaboration area to be explored by the parties is the proposed delivery of gas and crude oil for export to China, and also for the internal market of the Republic of Kazakhstan. Tethys has the right to export gas to China already and can sell oil on the domestic market.
China is the second largest trading partner of Kazakhstan after Russia. Last year’s trade turnover between Kazakhstan and China amounted at more than $ 17 billion.
Turkmenistan
Engineering works start on Turkmen segment of TAPI gas pipeline
Specialists of Institute of Oil and Gas under Turkmengaz started engineering survey works on the segment of the future gas pipeline Turkmenistan-Afghanistan-Pakistan-India, Turkmenistan State News Agency reported on September 4th.
They will hold technical and geological examination of the 215-meter territory in the southeast of the country — from Galkanysh deposit to the border with Afghanistan.
Currently, the specialists examined more than 20 km of the territory. The whole complex of investigation will be completed by early December.
The TAPI pipeline with the capacity of 33 billion cubic meters of gas per year will have a length of 1,800 km, the pipe diameter will be 1,420 millimeters. Turkmengaz was elected as the leader of the consortium TAPI Ltd.