ONGC Videsh Limited and its partners had offered to invest up to $ 11 billion for the development of the discovery, later renamed Farzad-B.
The Indian Union has so far invested about $ 400 million in the block.
New Delhi (Natural Energy News): India has lost the discovered Farzad-B gas field of ONGC Videsh Limited in the Persian Gulf as Iran has decided to prioritize domestic companies over foreign companies for the development of the region.
ONGC Videsh Limited (OVL), the foreign investment arm of the state-owned Oil and Natural Gas Corp (ONGC), had in 2008 discovered a huge gas field in the Persian offshore exploration block.
Related Article: Iraq to launch a new bid for Mansuria gas field; Scraps contract with TPAO-led group
OVL and its supporters had proposed to invest up to USD 11 billion for the growth of the finding, later renamed Farzad-B.
After standing on OVL's suggestion for years, the National Iranian Oil Company (NIOC) notified the corporation in February of this year about its intention to terminate a contract with an Iranian company for Farzad-B Development, the development direct Sources of knowledge said.
However, OVL continued its preoccupation with NIOC for the development of the region and sought the terms and conditions of the proposed contract for its evaluation, saying Iran had not yet responded to the Indian firm's request.
Related Article: Government moving ahead with 'vigilance' on privatization of Bharat Petroleum: Dharmendra Pradhan
Farzad-B has a total reserve of about 21.7 trillion cubic feet, about 60 percent of which can be recovered, and production is about 1.1 billion cubic feet per day.
Sources said unconfirmed information suggests that Iran has identified a local firm to develop the region, but OVL has not given up hope yet and continues to pursue Iranian authorities for the contract.
The 3,500 square kilometers of the Persian block has a water depth of 20–90 meters on the Iranian coast of the Persian Gulf.
OVL signed an Exploration Services Agreement (ESC) for the block on December 25, 2002, with a 40 percent operating interest. Other partners included Indian Oil Corp (IOC) and Oil India Limited (OIL) with a 40 percent stake. 20 percent share.
Related Article: The oil and gas sector can provide more than 1,00,000 jobs during this year
OVL discovered the gas on August 18, 2008, in a block declared commercially viable by NIOC. The exploration phase of ESC ended on 24 June 2009.
The firm submitted a Master Development Plan (MDP) of the Farzad-B gas field in April 2011 to the Iranian Offshore Oil Company (IOOC), the then designated authority by NIOC for the development of the Farzad-B gas field.
A Development Services Agreement (DSC) of the Farzad-B gas field was negotiated until November 2012, but could not be finalized due to tougher terms and international sanctions on Iran.
In April 2015, negotiations resumed with Iranian authorities to develop the Farzad-B gas field under a new Iran Petroleum Contract (IPC). This time, NIOC introduced Paras Oil and Gas Company (POGC) as its representative for negotiations.
Related Article: Andhra Pradesh has allocated 8,207 MW renewable power capacity
From April 2016, the two sides negotiated to develop the Farzad-B gas field under a unified contract covering upstream and downstream, including monetization/marketing of processed gas. However, the talks remained inconclusive.
Meanwhile, based on a new study, a revised Provisional Master Development Plan (PMDP) was submitted to the POGC in March 2017, sources said, adding that in April 2019, the NIOC has put forward gas sector development and crude under DSC. Gas at landfall point proposed by NIOC.
However, due to the US embargo on Iran in November 2018, technical studies could not conclude which is a precursor to commercial negotiations.
Related Article: Tata Power of India awarded 100 MW solar project contract
The Indian Union has so far invested around USD 400 million in the block.
0 Comments