Amid increasing pressure from US sanctions on the Iranian economy, the country's authorities announced the discovery of a field with geological reserves of 53 billion barrels of oil – potentially the largest in Iran and one of the largest in the world. However, the prospects for its development are extremely uncertain – under the conditions of sanctions, it will be impossible for Iran to attract large foreign investors.
Iranian President Hassan Rouhani announced the opening of a new unusually large field in the country with geological oil reserves of 53 billion barrels. His words referring to a speech on local television conveys Platts. According to Hassan Rouhani, the field is located in the province of Khuzestan near the border with Iraq, its area is 24 thousand square meters. km, the thickness of the oil-saturated layer is 80 m. “I inform the White House that while you imposed sanctions on the sale of Iranian oil, the country's workers and engineers were able to open 53 billion barrels of oil (reserves),” he said. The United States again banned the sale of Iranian oil in the fall of 2018 after its withdrawal from the nuclear agreement, because of this, oil production in Iran for the year fell by 40%.
Mr. Rouhani probably had in mind the geological reserves, since a significant number of wells must be drilled to transfer them to the confirmed category. Even in this case, the new field may become the largest in the country and enter the top 10 largest fields in the world. With geological reserves of 7 billion tons of oil, the discovery will exceed Samotlor in Russia or Rumailu in Iraq. In 1999, in the same province of Khuzestan, the Azadegan field was discovered with geological reserves of about 5 billion tons.
Now the basis of Iranian oil production is old fields, the development of which has been going on for more than half a century: Ahvaz, Marun, Gechsaran. Their production is declining, because under the conditions of sanctions, Iran cannot fully use modern technologies for enhancing oil recovery. Similarly, it is extremely difficult for Iran to attract investments in new oil projects – for example, Azadegan is still being developed only to a small extent, although the Chinese CNPC received a license for the northern part of the field, and negotiations with Total were ongoing in the southern part.
From this point of view, Tehran’s statements about the growth of oil reserves look politically motivated, since the country in the current conditions cannot monetize these reserves and simply accumulates them. Thus, the confirmed oil reserves in Iran for 2018, according to BP, were estimated at 155.6 billion barrels (9% of the world), while production – 4.1 million barrels per day (5% of the world). For comparison: Russia's reserves are estimated at 106 billion barrels (6.1% of the world), and production in 2018 amounted to 11.2 million barrels per day (13.5% of the world). In the case of the United States, the ratio is even more significant – reserves are 61.2 billion barrels (3.5% of the world), and production (including condensate) is 11 million barrels per day (13.2% of the world).
As David Ramin Jalilwand of OIES notes, in the long run, Iran “will rather fight to stop a further drop in oil production than to realize the full potential of its resource base.” At the same time, the analyst believes that the sanctions will not affect the gas production potential so much because there is a significant domestic market for this raw material. Iran is the fourth largest gas market in the world after the United States, Russia and China with a consumption of 225 billion cubic meters per year.
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