Iran Gas From Sirri.

Talks were resumed in February 2000 between TotalFinaElf and DSC on the supply of associated gas from the nearby Sirri A&E offshore fields. A deal, if signed, would involve about 70-80 MCF/d of dry gas developed by the French major in partnership with Petronas of Malaysia. The gas will be treated at the Dugas plant in Jebel Ali. The gross volume will be almost 90 MCF/d of wet gas, out of which 5,400 b/d of NGLs will be recovered and marketed by TotalFinaElf, operator of the Sirri fields. The remaining dry gas will be consumed at Jebel Ali - rather than pumped to the Conoco-operated oilfields.

The US has recently relaxed a trade embargo on Iran but it said to be still opposed to the gas deal. But TotalFinaElf is going ahead with plans to have a marine pipeline to Jebel Ali built within less than a year. Of the 133 km line required, a 93-km segment already exists, and only 40 km will have to be built.

Total had signed a $600m deal with NIOC of Iran in mid-July 1995 to develop Sirri A&E, which have since been on stream. These fields are very close to Iran's maritime border with Dubai, adjacent to Dubai's declining oilfields of Fateh, and are rich in gas. (TotalFinaElf is a partner of Conoco in Dubai's offshore fields). Soon after it signed the deal with NIOC, Total began negotiating with DSC. The green light for this was given by Dubai's strongman Shaikh Mohammed Bin Rashid, the crown prince and UAE defence minister as well as chairman of the local Economic Department. He was the one who concluded a political pact with the ruler of Sharjah in the mid-1980s and got the gas deal with Amoco Sharjah finalised quickly.

TotalFinaElf will buy the wet associated gas from NIOC at $0.80/m BTU and will sell the dry gas at $0.85/m BTU to DSC. The French company will make its profit from the NGLs. The wet gas will be pumped through a 20-inch, 40-km pipeline from Sirri to Dubai's depleting Fateh oilfield. From there the gas will be pumped to the Dugas plant through an existing but unused pipeline owned and to be operated by Dugas. For its part, NIOC has suggested that Dubai could also buy gas from the Sirri C and D fields and from Nosrat, another offshore oilfield nearby. (In March 1995, Conoco had signed a $900m deal with NIOC to develop Sirri A&E and get the gas for injection into its Dubai fields. With pressure by the Jewish lobby through Conoco's then parent company Dupont, Washington managed to kill the Conoco deal immediately. After the Jewish stake in Dupont was bought by Conoco, Washington did not allow it to revive its agreement with NIOC).