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NIOC and Gazprom signed an energy agreement on Sunday in the presence of Iranian Oil Minister Gholamhossein Nozari (c). (Photo by Ali Rafiei)
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Iran and Gazprom Sunday signed an agreement for the Russian energy giant to help Tehran develop its oil and gas fields.
Head of Gazprom affirmed that his company is ready to participate in major Iranian oil and gas projects, days after the French company Total made the mistake of dropping out of a multi-billion dollar gas deal in South Pars gas field in the Persian Gulf.
“Gazprom will be a cooperative partner for the Islamic Republic of Iran,“ IRIB quoted Alexei Miller, CEO of the Russian energy giant, as telling President Mahmoud Ahmadinejad in a meeting in Tehran.
Miller expressed willingness for Gazprom to participate ’in big oil and gas projects; in South and North Pars, Azadegan and the Caspian Sea fields’.
Ahmadinejad, for his part, said that Iran is ’interested in expanding ties with Russia in oil and gas as far as possible’.
Politically Motivated
The head of French energy giant Total last week said it was dropping out of a multi-billion-dollar gas investment to develop phase 11 of South Pars, claiming it was politically too risky to invest in the Islamic Republic.
However, the assurances made by Russia’s Gazprom chief for all-out cooperation with Iran in the latter’s lucrative energy sector put the reliability of Total’s ’politically motivated’ comments in doubt.
Western governments have pressured their companies to sever ties with Iran over its civilian nuclear program. To fight back, Iran is forging closer ties with Russian and Asian firms and insists it is capable of carrying out such projects alone.
Total Apologetic
For Europe, the lack of supply from Iran leaves it more dependent reliant on Russia. At the same time, European firms are hesitant to fully commit to Iranian energy deals, as they do not want to incite Washington’s wrath.
However, hesitation by oil majors has indeed led to new opportunities for companies such as China’s Sinopec, OMV of Austria, and the Indian national oil company and of course the Russian oil giant Gazprom.
At the same time, European countries putting unjustified pressure on Tehran are acutely conscious that the demand for energy is working against their efforts to hinder Iran’s economy.
Perhaps, that explains why Total announced on Saturday that ’it still has some important activities in Iran and intends to keep and develop them’.
“Total has some important activities in Iran and intends to keep and develop them,“ Head of the Public Relations Department at Total Roya Farhang told IRNA.
Farhang provided IRNA with some clarifications on the position of Total concerning Iran and said, “Iran is one of the most important countries for the world’s energy market. Therefore, Total is interested in future projects on the development of South Pars gas field and wants to maintain a long-term partnership with the National Iranian Oil Company (NIOC).“
Christophe de Margerie, Total Group chairman, spoke to Financial Times two weeks ago at the World Oil Congress in Madrid.
Margerie mentioned that for political reasons important countries like Iran were actually not playing the role they could and that in the current situation it would be taking too much political risk to invest in Iran.
He said that the statement was in no way referring to political events of last week, but unfortunately some US journalists used it in that context.
Concerning the Total Group’s position on Pars LNG project, Farhang quoted de Margerie as saying that it is out of the question to stop the Pars LNG project and it is also out of the question to abandon the project.
Farhang further quoted de Margerie as announcing that constructive talks are continuing with the NIOC to agree on a revised plan for the Pars LNG project, including on the development of the Phase 11 of South Pars to be ready to launch it as soon as conditions allow.
Total has a memorandum of understanding with the NIOC to develop Phase 11.
Gas Forum
During their Sunday meeting, Miller and Ahmadinejad also discussed the need for further development of the forum of gas exporting nations ’as a permanently acting international organization’.
Some observers describe the gas exporters’ forum as a ’Gas OPEC’. Iran and Russia have refused to call it a cartel, denying that the group would control prices and supply.
Gazprom said in a statement on Sunday that while in Iran, Miller also met with the Iranian oil minister and the National Iranian Oil Company.
Gazprom’s statement said Miller discussed setting up a joint venture for oil and gas exploration and production in Iran and building transport and refining infrastructure. In addition, it said they discussed Russian gas supplies being sent to northern Iran.
Iran has an estimated 974 trillion cubic feet in proven natural gas reserves, the world’s second largest after Russia. Around 62 percent of Iranian natural gas reserves are located in non-associated fields, and have not been developed.
Also, Iran is producing around 4.23 million barrels per day of crude oil which provides ample proof that the country is least affected by the illegal US-led sanctions.