Iran’s gas projects need $289bn investment by 2025, of which $137bn are to go on upstream projects.
According to the official documents seen by NGE, about $27bn are earmarked for distributing gas across the country, while $55.8bn are expected to go on expanding the national grid.
Among the gas grid projects, there are several major pipelines including Igat-6, Igat-7, Igat-9 and Igat-11, aimed at delivering gas to regions as well as to neighbouring countries such as Turkey, Iraq and Pakistan.
In the immediate wake of the lifting of sanctions in February, Italy’s Saipem signed memoranda of understanding on cooperating with Iran on Igat 9 and 11. These start at Assaluyeh – landfall for South Pars gas – and supply gas to western Iran and to the border with Turkey.
Some $44bn are expected to be invested in building gas refineries and gas storage facilities. $25bn would be invested in other gas-related mid/downstream projects as well by 2025.
Table: key Iranian gas projects
Projects | Projected investment amount ($bn) |
Upstream projects | 137 |
Cross-country gas transit projects | 55.8 |
Gas distribution projects | 27 |
Gas refining and storage | 44 |
Other gas-related projects | 25 |
Total | 288.8 |
Source: government
On the other hand, Iran plans to invest further $35bn in petrochemicals sector by 2025. Iran has already spent $15bn on petrochemicals out of a total planned $50bn by 2025.
For now, Iran produces 260bn m3/yr of raw gas, of which about 178bn m3/yr are dry gas. Iran’s net gas export was very low last year.
The report doesn’t give further details, but in the shorter term, Hassan Montazer Torbati, planning director of the National Iranian Gas Company, told Shana on April 18 that Iran plans to establish 5,000 km of gas pipelines for both export and domestic demand as well as 25 pressure boosting stations by Iranian calendar year 1400 (March 2021-March 2022). This will take about $15bn (about $2.8bn/yr).
Obtaining some $800mn from internal sources is possible, but gaining access to external funding is essential to meet developmental needs, he explained.
Meanwhile, Hamidreza Araqi, managing director of the National Iranian Gas Company, said the country’s annual gas sweetening capacity has reached 260 bn m³ and will hit 330 bn m³ in the next Iranian year (March 2017-March 2018), Shana news agency reported on April 17.
The actual gas sweetening level is very lower than the nominal capacity. Iran injects about 34bn m3/yr of raw gas to maintain oil production, while the petrochemical and CNG plants consumes about 13bn m3/yr.
Iran also loses about 10bn m3/yr in transmission and flares even more – some 11bn m3/yr.
The number of gas refineries will increase from the current 13 to 19 in 2022.
Araqi said that there are 36,500 km of gas pipeline and 75 pressure boosting stations operational nationwide.
He went on to say that 69.5 million people, comprising 19.4 urban families and 3.9 million rural families, living in 1,060 cities and 18,789 villages are benefiting from natural gas.
Moreover, Gholamreza Manouchehri, managing-director of Iranian Offshore Engineering and Construction Company, said April 17 that commissioning five platforms in the South Pars gas field by the end of the current Iranian year (March 2017) will boost the country’s gas production capacity by 100mn m³/d.
Iran produced 130bn m3 of natural raw gas from South Pars last year.
He added that the platforms will be commissioned in phases 19-21, putting the value of the five phases’ output at $6mn daily and $2.2bn annually, considering oil price around $40 per barrel.
“If we put price gas at $100/m³, phases 19-21 will generate $3.6bn/yr for the country.”
In the year to March 2015, four platforms related to phases 12, 17, and 18 came on stream, he said, adding that platforms related to phases 19, 20, and 21 will come on stream this year.
Iran says South Pars would only become fully operational at the cost of another $20bn by late 2018. Output could reach 700mn m3/d, or above 255bn m3/yr.
Natural Gas Europe