Iran Economy NewsIran bound to complete gas projects despite sanctions

Iran bound to complete gas projects despite sanctions


AFP: Top Iranian officials said on Thursday that Tehran is determined to push ahead with its mega gas projects without foreign aid and is raising billions of dollars to ensure their timely completion.

By Jay Deshmukh

ASSALOUYEH, Iran (AFP) — Top Iranian officials said on Thursday that Tehran is determined to push ahead with its mega gas projects without foreign aid and is raising billions of dollars to ensure their timely completion.

“We will not stop national development because of the others; we will not slow it down because of the absence of others,” Pars Special Economic Energy Zone managing director Moussa Souri told reporters in the southern Gulf port town of Assalouyeh.

Iran has already invested $48 billion (35 billion euros) in the South Pars projects, and the oil ministry has allocated $50 billion to them by 2016, Souri said.

Assalouyeh, in the southern province of Bushehr, has been chosen as the base for developing the offshore field.

Iran has planned a massive $200 billion investment in the energy sector over the five years to 2016.

“We do need more funds for which we have various options, including raising them through domestic bonds,” he added.

Souri said downstream projects and other related work also needed $50-100 billion, adding that assets of expatriate Iranians, including in the United States, could be tapped to meet these needs.

In mid-August Ali Vakili, the then head of Pars Oil and Gas Co, the firm in charge of developing South Pars, said $3 billion in domestic bonds will be issued during current year to March to fund the South Pars development.

Echoing a defiant tone, the managing director of the South Pars Gas Complex, Ali Akbar Shabanpur told reporters that sanctions imposed on Iran has not had any impact on energy rich Islamic republic.

“We are capable of doing theses projects. We are sure of our own expertise … For one hundred years we have been doing this,” he said.

“Iranian companies have been laying the pipelines for 30 years with all the obstacles and hurdles. We have been doing well. We know how to manage and how to manage better,” Shabanpur added.

When asked to elaborate on how Iran is procuring the technology to execute these giant projects, Souri said the Islamic republic possessed the required expertise.

“We are now domestically manufacturing 65 to 70 percent of the equipment required … and there are foreign companies who also have shown interest but given the sensitivity we would not like to name them,” he said.

The South Pars field, which Iran shares with the small state of Qatar, is comprised of 28 phases and holds around 14 trillion cubic metres (500 trillion cubic feet) of gas or eight percent of world reserves.

Oil-rich Iran has the world’s second largest natural gas reserves after Russia.

But its development has been delayed amid a lack of investment in a country faced with severe gas needs of its own and because of difficulties in procuring the required technology.

Iran’s vital energy sector is one of the key areas targeted by world powers in sanctions imposed against the Islamic republic for pursuing its controversial nuclear programme.

Most Western and European energy firms had withdrawn or put on hold their investments in Iran’s energy sector even before the latest round of UN sanctions was imposed last June.

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