The daily revenue of such a surplus output amounts to 18.6 Million dollars (180 billion rials).
At the moment, the Islamic Republic is producing 215 million cubic meters of gas everyday which is supposed to be raised by 260 million cubic meters if the phases 9 and 10 of South pars become operational at the end of the current Iranian year (began on March 21). In comparison, Qatar's output exceeds 455 million cubic meters a day.
According to Ali Vakili, managing director of Iran's Pars Oil and Gas Company even if the country is to attain the 260 million cubic meters of LNG production, it won't be able to boost it within the next two years, while Qatar is attempting to increase its output to 707 million cubic meters by 2012.
Iran's Ministry of Economic Affairs and Finance announced that last year, a cubic meter of Persian Gulf's LNG was sold 779 rials (almost 7.7 cents). Based on this price, Iran will earn 167,485 billion rials (nearly 16.7 million dollars) a day for extracting LNG in South Pars, while the daily LNG income of Qatar from the same region reaches above 35 million dollars.
South Pars gas field is jointly owned by Iran and Qatar. Iran's share of the gas reserves there is almost 14 trillion cubic meters, comprising about eight percent of total world reserves. Iran possesses the second largest gas reserves in the world after Russia.
But Qatar is boosting its gas production from the region on a daily basis, as their reach to the status of the first LNG producer in the world is due to their balk of gas extraction from the North Dome of South Pars.
In the meantime Iran is producing gas simply from eight 8 phases of South Pars. Although it is more than a year that two phases, 9 and 10 have been formally inaugurated by President Mahmoud Ahmadinejad, only 4 out of 24 sea wells in the phases have become operational and based on the latest news, there is no hope that they would begin production even by the end of the summer.
Referring to the promises made by Ahmadinejad on finalizing the two remaining in phases, Iran's Oil Minister Mas'oud Mir Kazemi had announced that the related agreements will be signed with the local and foreign contractors by the end of Iranian year, 1388 (ended on March 20). But the process is still suspended.
From April 21 on Iranian oil officials have claimed that the deals will be signed within a week, but now they maintain that simply the contractors have been assigned. In the middle of last year, the public relations department of Iranian Petropars Ltd announced that they have signed a deal with the Oil Ministry to launch phases 27 and 28.
Although the officials of the Ministry of also stressing that Petropars has been picked as the contractor to launch the phases and even the locations for implementing the plan have been found, the agreements are due to be signed.
The situation is the same for the other remaining phases. From the beginning of May it became clear that the Turkish Petroleum International Company (TPAO) is not interested to execute the contract on developing phases 22 to 24 of the South Pars.
In 2008 Iran and Turkish Petroleum International Company signed a 7 billion dollars agreement and the Turkish side was tasked with producing 20.4 billion cubic meters of LNG annually from the above mentioned phases. After the deadline set by Iran's for implementing the plan ended, finally the local Khatam al-Anbia engineering firm controlled by the Iranian Revolutionary Guard Corps (IRGC) was given the opportunity to develop the phases.
On the other hand, in 2007 British-Dutch Shell and Spain's Repsol signed a deal with Iran to develop the production and exports of LNG in phases 13 and 14 of South Pars, but the plan was not also executed.
In April last year, Iran set a deadline for Shell and Repsol to make clear their involvement in the field, but they refused to accomplish the task after the West powers, above them the United States pressured international companies to withdraw from oil and gas projects in Iran, since defiant to their requests and intimidations, Tehran is still pursuing its nuclear program. This project was also handed over to Khatam al-Anbia Construction Company.
Petropars Ltd and Iranian Offshore Engineering and Construction Company (IOEC) have been assigned to develop respectively the phases 19 and 20, 21. However no agreement has been signed between the companies and Iranian oil officials who have not been able to break the spell cast on the development plans.
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