Iran has signed an agreement with Norway’s DNO to study the development of a key oil field which is believed to be jointly shared with Iraq in a yet another sign that shows Western companies are already welcoming the country’s lucrative post-sanctions investment opportunities.
The agreement – which DNO signed with the National Iranian Oil Company (NIOC) - involves studying Changuleh oil field which sits on Iran’s border with Iraq in the western province of Ilam.
Based on the agreement, Norway’s fourth largest oil and gas company will study Changuleh within six months – a crucial move that could enable it to win a deal to develop the field once the related talks with the NIOC succeed.
NIOC Director for Engineering and Development Affairs Gholam-Reza Manouchehri told reporters after signing the agreement with DNO’s Managing Director Bjorn Dale that the field could be linked to another nearby field named Azar.
Iran had previously announced that Azar, itself, was linked to Iraq’s Badra oil field. A domestic company – Sarvak Azar Engineering and Development Company – is already pushing ahead the development of the field with a target production of 65,000 barrels per day (bpd). The target production of Changuleh is 50,000 bpd.
Azar and Changuleh were discovered in 2005 as a result of explorations conducted by a consortium comprising Russia’s Lukoil and Norway’s Statoil. Both fields – together with Iraq’s Badra – are believed to hold an in-place reserve of about 3.5 billion barrels.
NIOC awarded the project to develop Changuleh to DNO only a week after it signed a major deal with the French energy giant Total over the development of a key gas field in Persian Gulf waters.
Accordingly, Total will lead a consortium comprising China National Petroleum Company (CNPC) and Iran’s Petropars over the development of Phase 11 of the country’s huge South Pars gas field. The value of the deal has been estimated at $4.8 billion.
