In news: The National Iranian Oil Company (NIOC) signed a contract worth USD 1.78 billion with Petropars Group, a local company for the development of Farzad B Gas Field, in the Persian Gulf.
About the gas field-
- ONGC Videsh Ltd (OVL), the overseas investment arm of state-owned ONGC, had in 2008 discovered a giant gas field in the Farsi offshore exploration block.
- OVL, with 40 per cent operatorship interest, signed the Exploration Service Contract (ESC) for the block on December 25, 2002.
- Other partners included Indian Oil Corp (IOC) with 40 per cent stake and Oil India holding the remaining 20 per cent stake.
- OVL and its partners had offered to invest up to USD 11 billion for the development of the discovery, which was later named Farzad-B.
- The Indian consortium has so far invested around USD 400 million in the block.
- With the new development, India lost the gas field, which holds 23 trillion cubic feet of in-place gas reserves, of which about 60 per cent is recoverable.
- It also holds gas condensates of about 5,000 barrels per billion cubic feet of gas.
- A Development Service Contract (DSC) was negotiated till November 2012, but could not be finalised due to difficult terms and international sanctions on Iran.
- In April 2015, negotiations restarted with Iranian authorities to develop the gas field under a new Iran Petroleum Contract (IPC).
- This time, NIOC introduced Pars Oil and Gas Company (POGC) as its representative for negotiations.
- From April 2016, both sides negotiated to develop the field under an integrated contract covering upstream and downstream.
- With the imposition of sanctions on Iran in November 2018 by the Donald Trump administration after it pulled out of the 2015 nuclear accord, it was impossible for India to conclude technical studies on the project.
- In October, 2020, NIOC informed OVL of its intention to conclude the contract for Farzad-B development with an Iranian company, in an apparent rejection of the Indian firm’s bid.
Source: Livemint
