Iran, Ansaldo Sign Deal on Flare Collection and Use
Four major Iranian energy companies signed a memorandum of understanding (MoU) October 18 with Italian turbine manufacturer Ansaldo Energia to modernise their equipment as well as collect and convert flaring gas for power use.
The deal was signed between the Italian company,Pars oil and Gas (POGC); the National Iranian South Oil Company (NISOC); the Iranian Central Oil Fields Company (ICOFC) and the Iran Fuel Conservation Company (IFCO), the country’s oil ministry announced.
The total flaring amount at the fields controlled by the three companies is over 12.5bn m3/yr. Iran’s total flaring stood at 16.405bn m3 for 2016, according to World Bank estimates; this is around 4.3bn m3 more than in 2015.
During the signing ceremony the CEO of NISOC Bijan Alipour said that the fields controlled by his firm have an 83% share in total Iran’s oil production with 7.5bn m3/yr of flaring. He said that some 97% of the company’s equipment is up to 40-years old and should be modernised. He said that around $6bn is needed for both the collection and use of the flare gas at NISOC.
Iran’s oil minister Bijan Namdar Zanganeh announced in June that some $5bn investment is required just to collect the flaring gas in the country.
The deputy CEO of ICOFC Ahmad Rajabi said that his company produces 200,000 b/d oil and 109.5bn m3/y of gas (5.26% of oil and 38.5% of Iran’s gross gas output) with 1.5bn m3/yr of flaring.
POGC controls the giant South Pars gas field that produced 150bn m3 in 2016, and shared 54.3bn m3 of the country’s overall gross gas production that year. Its CEO Mohammad Moshkinfam said that South Pars, with its 413 wells, 40 platforms and 13 refineries, would produce 266bn m3 gas, 1mn b/d condensate and 20mn metric tons/yr of LPG after full completion in 18 months’ time – with the Exception of phase 11 – it is expected to become operational in three years.
He did not mention the amount of flaring, but according to an official document, prepared by the oil ministry and obtained by NGW, the amount in its refineries was around 3.5bn to 4bn m3 in 2016. No information is available on the amount of flaring at its platforms however.
Ansaldo would generate 700MW power by collecting and using the sour flaring gas at phase 12, the largest phase that produces 24bn to 25bn m3/yr. After converting the power plant to combined-cycle one, its capacity would reach 1GW, the ministry’s report said.
In September this year, POGC and French contractor Sofregaz signed a contract to collect flaring gas in phases 2 and 3 of South Pars.
Some $500mn is needed to collect the total flare gas at South Pars.