Iran grants gas field project to local firm after terminating agreement with Indian consortium

After the Indian consortium discovered the gas field in 2008 offshore the Persian Gulf, they refrained from carrying out the project due to the US sanctions.

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It has been reported that Iran reached an agreement with a local firm for the $1.8 billion gas field project off the coast of the Persian Gulf. According to the report, the Iranian Petropars Group will assume the project to develop the Farzad-B gas field in the Persian Gulf. It is estimated that the gas field reserves contain 21.7 trillion cubic feet of gas, 12.8 trillion cubic feet of natural gas, and 212 million barrels of gas condensates.

The agreement was also confirmed by a website known to be close to the Iranian Oil Ministry. According to the report issued by the website, the agreement with the Petropars Group has been reached after negotiations with Indian companies failed. Petropars earlier operated the project for developing another massive gas field, South Pars.

Quoting from Iranian Oil Minister Bijan Zanganeh, the website stated that “The contract to develop the Farzad-B gas field was signed between National Iranian Oil Co. as the employer and Petropars Group as the contractor.”  According to the agreement reached between the state-owned National Iranian Oil Company (NIOC) and Petropars, the latter would produce 28 million cubic meters of sour gas per day for five years.

Touching upon the failed talks with the Indian companies, Minister Zanganeh said that the Indian sides were unwilling to participate in the project due to US sanctions imposed on Iran. The Indian consortium was comprised of Oil and Natural Gas Corporation (ONGC), Oil India Limited, and Indian Oil Cooperation. The consortium had initially invested around $100 million in the field.

Oil Minister Zanganeh also indicated that Iran gave the Indian consortium ultimatums multiple times to fulfill the responsibilities derived from the agreement. However, the Indian companies did not respond to these ultimatums, Zanganeh added.

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