Iran Awards Flare Gas Contract to Private Sector

For the first time in the Iranian oil industry’s history, the oil ministry has signed a contract with the private sector for gathering flare gases, or associated gas, in oilfields and using it in electricity generation.

The managing director of Arvandan Oil and Gas Company (AOGC), a subsidiary of the National Iranian Oil Company, announced on March 16 that based on a five-year contract between AOGC and HirbodNiroo Group, 680,000 m³ of associate gas will be gathered from the Arvandan oilfield for use in electricity generation. The price was set at $41.1/'000 m³. 

The company is to  build a 100-MW power plant. According to a report, published on March 16 on AOGC’s website. The director of AOGC Soltan Kamali also said some 850,000 m³ of associated gas would be gathered from West Karoun region in the near future. Iran has captured 32.9mn m³/d of associated gas in the past 10 years that would otherwise have been flared.

Operational fields of AOGC

Flaring from oil ministry fields

Iran’s raw gas production capacity is 700mn m³/d. The country consumed 433mn m³/d of sweet gas during the current fiscal year (23mn m³/d more than the previous year), which will end on March 20, Shana reported on March 16.

Iran produced 487mn m³/d of refined gas during the last fiscal year, but 473mn m³/d in the ten months of this fiscal year. Iran increases sweet gas production in winter.

Iran started production from phases 17, 18 and 19 of the South Pars gas field and brought three more phases – 12, 15, and 16 of the field – into full operation in the second half of this fiscal year. Phases 12, 15, and 16 have a total capacity of 130mn m³/d. Phases 17-19 will have a total capacity of 100mn m³/d when fully operational. The phases are now at 25-30% of capacity.

Iran Desk