Iran's energy sector review

Iran signed three heads of agreements (HOA) with Anglo-Dutch Shell to study South Azadegan with less than 6 percent oil recovery rate and Yadavaran with 8 percent oil recovery rate as well as the country’s second major gas deposit Kish field with 1.4 trillion cubic meters of sour gas reserves. Enhanced oil recovery (EOR) sector still remains one of Iran’s major challenges in upstream sector. Azadegan and Yadavaran as well as Yaran field are joint between Iran and Iraq, called West Karoon block with 64 billion barrels of oil in-situ reserves, accounting about 8 percent of the country’s total oil in-situ reserves. The recovery rate of this block is about 6 percent in average, namely in normal situation, Iran is able to produce only 6 percent of the reserves. The country plans to increase this rate to 25 percent. In total, the recovery rate of Iran’s oil fields is about 25 percent. Fiscal Year Recoverable oil reserves Life of reserves New in-situ reserves discovery Oil p

Iranian President Hassan Rouhani on Dec. 4 submitted the next fiscal year’s budget to the parliament on Dec.4. In the budget, 30 percent account for oil and gas condensate revenues, remained almost unchanged year-on-year. The total budget stands at about $97 billion (1,100 trillion rials), based on a dollar rate at 33,000 rials, about 3,000 rials more than the official rate during the current fiscal year. The amount of oil and gas export volume hasn’t been mentioned in the budget bill, but Iranian media quoted some officials as saying that the oil price has been set at $50 per barrel. Iran’s oil and gas condensate revenues is expected to increase by by 48 percent and 40 percent, compared to the current fiscal year based on rial and the US dollar respectively . But how realistic are these figures? Recently, OPEC reached an agreement to cut output by 1.2 mb/d to 32.5 mb/d, but Iran was not only exempted, but was also allowed to increase the output by 90,000 b/d to 3.797 mb/d i