IRAN - South Pars Oilfield.

POGC has retendered South Pars' oilfield project following failure of its latest round to attract enough serious bidders. Only the local semi-private Naftkav submitted a full proposal in early Sept. 2002, renewing it one month later when the deadline was extended at the request of two foreign bidders, Statoil and Norsk Hydro. But Statoil only submitted a "conditional bid...or technical documentation" on Oct. 7. Norsk Hydro in turn handed over a "technical report...showing solutions" by the deadline. The list of interested companies initially included Total, ENI and Maersk Oil & Gas but they all dropped out despite the availability of a new data in August.

POGC projects the field's eventual at 130,000 b/d, with the initial tender limited to a 35,000 b/d first phase. Naftkav, which had agreed a co-operation deal with oilfield services giant Schlumberger and is talking with Petronas and others about a possible JV, said last Oct. its proposal remained on the table. Naftkav is listed on the Tehran stock exchange but the Oil Industries Investment Co., created by the NIOC Pension Fund and NIOC employees, has a stake of 51%.

The problem with the South Pars oil project is the degree of uncertainty over the field's prospects. POGC is certain this is a very promising field, while foreign companies can only think of the problems they would face in making it economical. Both Statoil and Norsk Hydro have considerable experience in developing complex structures like South Pars.

O&M For Pars Complex: South Pars Gas Complex (SPGC), a unit National Iranian Gas Company (NIGC), in Oct. 2002 broke new groud by opening up operation and maintenance services to the private sector. First to go on the block was a contract for the first three phases of South Pars. The tender document specifies "total running of the plant...overall management, management of all related logistics for operations and maintenance", including all forms of transport, marine operations and catering.

Responsibility for overall O&P for oil and gas projects has traditionally been the monopoly of state enterprises. The tender decision was in favour of breaking up the monopoly, in line with privatisation policy. The SPGC tender notice says interested joint ventures must consist of an Iranian partner with a share of at least 51% and a foreign partner holding a minority stake.

The Bahregansar group of fields, first discovered in 1960 by Agip in the SIRIP (Agip-NIOC) venture, lie in the north of the Gulf: Bahregansar and Hendijan. The fields, linked by pipeline to the Emam Hassan Terminal at Gurreh, were among oil installations attacked by Iraq during the 1980-88 war. Limited repairs have enabled them jointly to produce 15,000 b/d. Bahregansar was Iran's first offshore oilfield and went on stream in 1961, with a depth of 9,000 ft. Its reserves have been estimated at 1 bn barrels of 30 deg. API oil. The Iranian Oil Engineering and Construction Co. (IOEC) in 1996 won a $80m contract to boost production to 120,000 b/d. But IOEC's work has been delayed for lack of financing. In Nov. 2002, NICSOC gave Iran's Engineering & Marine Installation Construction Co. a contract to re- develop the field and raise its capacity to 65,000 b/d.

Hendijan, found in 1968 at a depth of 11,000 ft, went on stream in the 1970s with reserves reported at 300m barrels of 23 deg. oil. Bahregansar and Hendijan are inter-connected.

The Kharg-related group of fields were explored in 1960 by Amoco in the IPAC (Amoco-NIOC) partnership. The group consists of Dorood, Soroush, Nowruz, Foroozan and Abuzar. These fields, linked to Kharg island by pipeline, were frequently targeted by Iraq during the 1980-88 war.

Dorood (formerly Darius) was found in 1961 by Amoco (now part of BP) and was regarded as being the largest among Iran's offshore oilfields, with recoverable reserves estimated in late 1998 estimated at 600m barrels of 34.4 deg. API oil at a depth of 11,000 ft.

Total developed Dorood under a $1 bn BBC signed on March 1, 1999 by Elf (55%) in partnership with Agip (45%) and in May 2002 brought on stream two wells which were connected to processing facilities on Kharg island. Total recently began drilling another 27 wells - three of them offshore and the other on Kharg. They will be completed by early 2004 to raise the field's capacity from 130,000 to 220,000 b/d. The project entails water and gas-injection facilities to upgrade the field. Recoverable reserves are to be more than doubled to 1.5 bn barrels (see background in Vol. 56, No. 14).

The EOR system involves 10 water injection wells, four gas injection wells for 400 MCF/d of associated gas, and 15 additional oil production wells. The field's new 220,000 b/d capacity should last for 25 years.