It looks like the Revolutionary Guards have attacked the Oil Minister — and President Rouhani — over attempts to bring foreign investment into Iran’s oil and gas fields.
Fars News, linked to the Guards, wrote on Monday:
The Iranian contractors who have taken the responsibility for developing the giant South Pars gas field have proved better than their giant foreign rivals, including France’s Total and Royal Dutch Shell, a former senior oil official said.
“The (Iranian contractors’) progress in the development of the new South Pars phases is surprising compared to the performance of the giant foreign oil firms,” the official, who asked to remain unnamed, (said)….
“Given the achievement of such progress by Iranian contractors and the manufacture of products and equipment by Iranian industrialists, waiting for (French oil and gas company) Total and (Royal Dutch) Shell is no way helpful to the country,” he added.
Iran’s energy sector has been severely affected by a collapse in foreign investment since 2010, amid US and European sanctions. French, Italian, Spanish, and Russian firms have all pulled out of projects.
Problems have been exacerbated by the failure of Chinese companies to deliver on projects for oilfield development. Last week Iran finally cancelled a $2.5 billion contract with the China National Petroleum Corporation, claiming it has made little progress in fields on the Iraq border.
To counter the decline, Oil Minister Bijan Namdar-Zanganeh has been pursuing contracts with Western firms, with re-introduction of investment planned as soon as a comprehensive nuclear agreement is reached. Companies who have been involved in talks included Italy’s ENI, Royal Dutch Shell, Austria’s OMV, and Vitol, the world’s largest oil trader.
Tehran to World “Please Help Us With Our Oilfields”
President Rouhani has eagerly supported the efforts, telling the World Economic Forum in Davos in January, “The Islamic Republic of Iran is prepared to engage in constructive cooperation for promoting global energy security, drawing on its vast oil and gas resources.”
He and Namdar-Zanganeh met representatives of Britain’s BP, Eni, Shell, Saudi Arabia’s Aramco, and France’s Total at the Forum.
Perhaps far from coincidentally, the unnamed official’s criticism was published as more than 600 foreign firms from 32 countries attended the opening of the International Oil, Gas, Refining, and Petrochemical Exhibition in Tehran.
The foreign investment could clash with the plans of the Revolutionary Guards, whose engineering and logistics firms have major stakes in oil and gas projects — and who hope to expand those projects.
The Fars article supports this by pointing to the South Pars gas field, one of the largest in the world, which is in the Persian Gulf on the common border between Iran and Qatar.
It also publishes claimed remarks by Zanganeh, made on Monday to MPs, which step back from the approach to foreign companies and imply that the Guards’ firms will be central to projects: “(South Pars) will neither be entrusted to the private sector nor the foreigners; we will accomplish the project ourselves.”
Foreign investment in the field has all but disappeared in the last four years, but Rouhani has promised that all 28 phases of development will be completed by the end of his term in 2017.
