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August 2011, No. 61


Exclusive 16th International Oil Show

Private Sector to Take Over Oil Wells


Management and steering of oil and gas wells
will be given to the private sector.


Managing director of the National Iranian Oil Company has noted that the total volume of Iranís oil reserves will be increased by 500 billion barrels through increasing recovery factor of the Iranian oil fields by only one percent.

Ahmad Qalebani added that the Iranian private sector will be soon allowed to take over some oil wells.

The managing director, who was addressing a conference on productivity and excellence in the Iranian oil industry, noted that Iran enjoyed a total of 700 billion barrels of crude oil and liquid hydrocarbons while more exploration should be carried out in many unexplored areas of the country.

The deputy minister of petroleum further stated that Iranís exploitable reserves were previously put at more than 155 billion barrels, but the Fifth Economic Development Plan has obliged officials to increase recovery factor of the oil wells by one percent.

He said that during the Fifth Economic Development Plan a total of 5 billion dollars will be invested in raising the recovery factor, which if increased by 5 percent, the value of Iranís oil reserves will increase by 100 billion dollars.

He further noted that there is a plan to allow the private sector to take over management of some oil wells, adding, ďBased on this plan, management and steering of oil and gas wells will be given to the private sector while the government will be still owner of oil and gas reserves which constitute national riches.Ē

The official stated that better management and exploitation of oil and gas wells will lead to sustainable production from those wells and the National Iranian Oil Company will only supervise activities of the private sector.

Qalebani mentioned privatization of management and maintenance of certain oil facilities; privatizing management and production from wells, exploration and development; establishment of mixed Iranian and foreign companies; advance sale of products; establishment of upstream oil and gas companies based on international trade standards; taking advantage of a financial model for construction of necessary facilities; as well as commissioning of oil facilities as the best ways through which private sector could contribute to the oil sector.

$150 billion to be invested in upstream oil and gas industry: Meanwhile, Mohsen Khojasteh Mehr, deputy minister of oil for planning and supervision over hydrocarbon reserves, noted that 150 billion dollars will be invested in upstream oil and gas industry during the Fifth Economic Development Plan to increase the sectorís revenues to 179 billion dollars by 2015.

He said that a total of 150 billion dollars will be invested in the sector which will increase productivity of upstream investments by 14 percent at the end of the Fifth Economic Development Plan.

The official said that about 100 billion dollars will come from foreign reserves and Iranian banks, about 60 billion dollars through buyback deals with foreign companies, and about 50 billion dollars through internal funds of the National Iranian Oil Company.

 

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  August 2011
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