Shell signs MoU for exploration in Iran

SHELL has signed a memorandum of understanding with the National Iranian Oil Company (NIOC) to look at cooperation and investment in three of Iran’s largest oil and gas fields.

Iran’s Fars news agency reported that Shell and NIOC will conduct studies on the Azadegan, Yadavaran and Kish oilfields. The deal was signed by Noureddin Shahnazizadeh, managing director of the NIOC’s Petroleum Engineering and Development Company (PEDEC), and Hans Nijkamp from Shell, in the presence of NIOC managing director Ali Kardor.

A Shell spokesperson confirmed to The Chemical Engineer that the company had signed an MoU to explore areas for potential cooperation in Iran but would not give any details, saying that it was commercially sensitive information and therefore confidential.

The Azadegan field straddles the Iran-Iraq border and is estimated to contain 6.5 bn bbl of oil. The Yadavaran oil field, in Khuzestan province, contains around 17bn bbl of oil and already produces 100,000 bbl/d. The Kish gas field is thought to contain at least 50trn ft³ of recoverable gas and 1bn bbl of condensate.

Shell said in October that it was in talks to revive its Iranian petrochemicals activity, and is now the latest in a string of major oil companies to look at a return to Iran, following the lifting of international sanctions on the country earlier this year. Iran agreed to long-term monitoring and curbs on its nuclear programme in return for the lifting of the sanctions.

At the beginning of December, Thailand’s PTTEP signed an MoU with NIOC to carry out preliminary studies of the Changuleh, Balal and Dalamperi oil fields. In November, NIOC signed an agreement with Total, China National Petroleum Corporation (CNPC), and its own subsidiary Petropars to develop phase 11 of the South Pars gas field (SP11) in the Persian Gulf. Oil services major Schlumberger signed an MoU with NIOC on 29 November to study the Shadegan, Parsi and Rag-e Sefid oil fields in Khuzestan. Japan’s Sojitz signed an MoU for a methanol to propylene plant in October, while Daewoo said in May it had signed an MoU to build a 300,000 bbl/d refinery.

Many analysts see Shell’s deal as a sign that the world’s biggest oil firms will not be put off investing in Iran, despite the election of Donald Trump, who is openly hostile towards Iran, as the next US president. Trump has said he will overturn the nuclear deal with Iran and either renegotiate it or pull out.