Invest $80 Billion To Avoid Becoming An Importer, Says Owji

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According to oil minister, Iran needs to invest $80 billion in its gas industry to achieve its 1.4 Bcm/d production target, says a Platts Market Insight.

Invest or import

Oil minister Javad Owji said, “If there is no sufficient investment, we will have to import,” Owji was quoted as saying by oil ministry news service Shana.

The necessity of investment in this industry is becoming [clearer] day by day. If this does not happen, production in the energy industry faces problems.”

Joint Comprehensive Plan of Action

The flow of foreign investment into the US-sanctioned country has thinned since the US withdrew from a nuclear deal in 2018. In the past year, parties to the deal including the UK, China, France, Germany, Russia and the US have engaged in talks with Iran to revive the so-called Joint Comprehensive Plan of Action.

Iran hopes to bring back IOCs to its investment-hungry hydrocarbon fields. Iran sits on the world’s second-biggest gas reserves after Russia. It exports gas to Iraq and Turkey, with a minor swap with northern neighbors Azerbaijan and Turkmenistan.

Refining issues

Fuel supply was another issue for the OPEC member, Owji said.

Each year, 10%-12% are added to liquid fuel consumption. Therefore, we should think about increasing refining capacity too,” said Owji, who had earlier warned about high consumption of gasoline (nearly 100 million liters/day), which would may force Iran to restart imports after a few years of self-sufficiency.

The capacity currently equals to the consumption. If necessary investment is not made in the refining industry, we will face problems in the future,” Owji said.

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Source: Platts

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