Rystad: Iran Could Award $50b in Offshore Contracts By 2020

Rystad: Iran Could Award $50b in Offshore Contracts By 2020

Iran could award around fifty billion U.S. dollars worth of contracts to offshore oilfield services providers by 2020, in a move to boost production to the pre-sanctions levels.

According to estimates by Rystad Energy, a Norwegian energy intelligence group, around $100 billion will be invested in the country’s upstream sector between 2016 and 2020.

Around half of this, Rystad says, will be directed towards the offshore market, which is expected to be at $9 billion this year and grow to $11 billion in 2020.

Rystad says that the majority of the market consists of Engineering, Procurement, Construction and Installation (EPCI) contracts. Five new platforms will be commissioned in 2017 at South Pars phase 20 and 21, and more to follow at the $4 billion ENI project South Pars phase 11 as well as at Farzad B discovered by an Indian consortium, Rystad says.

Furthermore, according to Rystad, an increased number of active platforms, together with aging facilities that have lacked investments during the sanctions, will force a rise in the Maintenance and Operations purchases. Also, the energy intelligence group expects that the demand for drilling contractors as well as well service and commodities will pick up in the coming years since many of the offshore projects under development will go into pre-drilling.

Roughly 25% of the investments are well-related costs; with 22 wells to be drilled over the next 30 months at South Pars phase 14 and additional infill drilling to start at the producing field, these services will rise in the next few years. That Iran is working on boosting its offshore sector, speak recent reports that the country has ordered five jack-up rigs from a Russian shipyard, with discussions reportedly held with a South Korean yard for five more offshore drilling rigs.

Iran’s current production has been estimated to be somewhere between 3.5 and 3.8 million barrels per day. The country’s petroleum minister Bijan Zangeneh in April said that Iran was aiming to raise its crude oil production to 4 million barrels a day by March 2017.

Source: Offshoreenergytoday

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