Iran's energy sector review

Iran's national budget bill for the next calendar year, which starts on March 21, has envisaged issuing $40 billion in bonds by state-run entities, $15 billion of which will be used to finance oil and gas projects. The bill was submitted to the parliament by President Mahmoud Ahmadinejad with two months delay. Considering the decrese of foreign investments in Iran because of international sanctions as well as increase of liquidity which has hit the unprecedented figure of $310 billion (five times increase in 6 years), Iran issued 13.7 trillion rials (some $950 million) in bonds in the current calendar year (began on March 21, 2011), but just $250 million of the bonds were sold. Iran refers to the low interest rate as the main reason for the low public demand for the bonds, which held 17 percent in profit (4 percent lower than the country's official inflation rate). So, the Central Bank increased the interest rate to 20 percent last week. Iran says that the decision was effectiv...

Gas consumption in Iran has hit the record high of 551 million cubic meters per day in a situation that weather temperature in 28 of the total 31 provinces has reached below zero. Currently Iran's daily gas production stands at around 554 million cubic meters, just 3 million cubic meters more than the daily production. This is while the country is obliged to export natural gas as much as 10 times of this figure to Turkey per day. Turkey argues that Iran has failed to meet its obligations on exporting 30 million cubic meters of gas per day based on a deal which was signed by the two countries in 1996. So, Turkey has filed the second complaint against Iran and will sue the case at International Arbitration Court. The first legal case against Iran was about on the gas price. Iran used to export 24 million cubic meters of gas per day to Turkey. But today, Iranian deputy oil minister and Managing director of the National Iranian Gas Company (NIGC) Javad Owji announced that the country e...

Iranian oil minister Rostam Qasemi banned purchase of oil-processing technologies from 5 European companies. Three of them are from the UK (UOP, SW и Start Company), one from France (Axens) and the last - joint Dutch-British company (Royal Dutch Shell). Despite the fact that these companies issued licenses to Iran they nevertheless refused to implement the third phase of the oil refinery in Abadan - plan of development of gasoline production (Cat Cracker Unit). Iran said earlier that some productions of the oil refineries in Tehran and Shazand obtained licenses of above mentioned European companies and without their participation were commissioned by local companies. At present there are nine oil refineries in Iran which obtained licenses from the European companies. Production volume of oil-processing sector of Iran amounts to 42.952 million tons. Some 35 per cent of licenses in this sector have been obtained from the companies of 35 per cent -Germany, 18 per cent - the UK, 12 per cen...