Iran Pushes Ahead with Oil, Gas Development, Shrugs Off Need for Foreign Investment

Iran Pushes Ahead with Oil, Gas Development, Shrugs Off Need for Foreign Investment
(Saturday, May 10, 2025) 00:11

TEHRAN (NIPNA) -- Iran is pressing forward with upstream and downstream oil and gas development projects without waiting for foreign investors, the country's petroleum minister said on Friday, as the Islamic Republic seeks to leverage domestic capabilities to drive its energy ambitions.

Speaking on the sidelines of the second day of the 29th International Oil, Gas, Refining and Petrochemical Exhibition in Tehran, Petroleum Minister Mohsen Paknejad said Iran is "fully committed to pursuing development projects across the value chain" and emphasized confidence in domestic resources to achieve major milestones.

“We are not waiting for foreign investors,” Paknejad told reporters. “With the backing of local expertise and capacity, we can take significant steps forward.”

Resumption of Caspian Sea Drilling After Three Decades

The minister also announced the resumption of exploratory drilling operations in the shallow waters of the southern Caspian Sea for the first time in 30 years, marking a key milestone in the country’s upstream ambitions.

Located 15 kilometers off the coast and in water depths of 70 to 75 meters, the Rodsar structure is targeted for drilling down to 5,000 meters below the seabed. The project, with an initial investment of $50 million under an EPD contract, could potentially yield over 600 million barrels of oil in place and about two trillion cubic feet of natural gas, based on preliminary seismic and geological studies, he said.

While stressing that these figures are estimates, Paknejad said further appraisal will be needed to confirm commercial viability. The drilling will be conducted by domestic firms such as Khazar Oil and North Drilling Company, utilizing the semi-submersible Iran Amir-Kabir platform.

Gas Network Stability Amid Harsh Winter

Reflecting on energy supply during the previous winter, Paknejad said it was “one of the least challenging” in recent years. He credited swift action by the National Iranian Oil Company, which added 30 million cubic meters per day to the country’s gas production capacity in a short timeframe.

However, he noted that inefficient power plants drove up fuel consumption, resulting in nearly $600 million in diesel imports during the peak winter months. “Only $200 million of that was used for power generation. The rest was essentially wasted,” he added, calling for cooperation from the Energy Ministry to improve thermal efficiency.

Focus on Technology, Innovation, and Contracts

Paknejad called for a shift away from traditional exhibition formats, urging more focus on innovation, AI, and new technologies. “We have lagged behind in this area and must not fall further behind neighboring countries,” he said, expressing hope for a more tech-centric showcase in future editions with private sector involvement.

He also highlighted streamlined contract processes as a key reform. “We have reduced the contract finalization timeline from several years to just six months,” he said, crediting new mechanisms approved by the Economic Council and direct support from the president and first vice president.

Energy Imbalance and Efficiency Campaigns

Addressing Iran’s long-standing energy imbalance, Paknejad warned that growing demand has continually outpaced production increases, despite various mitigation efforts. He called for public cooperation in reducing consumption and pointed to last winter’s “Two Degrees Less” campaign as a successful initiative.

“The core solution lies in demand-side management,” he said, adding that the government must provide high-efficiency equipment and support structural changes in energy use.

Future Outlook and Cautious Optimism

Looking ahead, Paknejad said Iran is targeting 4.58 million barrels per day of crude production and 1.35 billion cubic meters of gas by the end of the seventh development plan. He underscored that drilling operations in the Caspian Sea are currently proceeding with local resources, but noted Iran is open to international cooperation for technology transfer and investment — excluding “one particular country.”

He declined to specify oil production and export volumes, citing sanctions, and instructed officials not to release detailed figures.

“Our production and exports continue at full capacity and without disruption,” he said.

 


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