Iran has formally put on offer four exploration blocks in the Caspian Sea as part of its latest plans to expand and upgrade its oil and gas industry.
One of the blocks, Sardar-e Jangal, has 2 billion barrels of 39 degrees API oil in place, according to officials.
The acreage — blocks 24, 26, 29 and Sardar-e Jangal in Block 6 — was presented to potential investors at the Iran Oil Summit in Tehran late last month.
Iran has been slow to develop its Caspian energy assets because it has much more accessible resources in the south of the country and faces potential disputes with other Caspian littoral states in the absence of a regional border agreement.
Recent reports from Azerbaijan suggest that Iranian and Azeri oil and gas officials have been trying to reduce tensions over border issues and increase co-operation on energy and other projects.
Using a locally-built semi- submersible, Iran’s Khazar Explor-ation & Production Company (Kepco) has carried out some exploration drilling for more than a decade.
Some 2D and 3D seismic has also been shot in Iran’s Caspian waters, including by Shell, which pulled out of a project following a clash between Iranian warships and BP vessels operating from the Azerbaijani side at the turn of the century.
Two exploration wells have been drilled at Sardar-e Jangal — one was completed some years ago to a depth of 2500 metres and the other was production tested in early 2015 at 3500 metres, according to Kepco.
Little is known about the three other blocks on offer, but Kepco said investors in the Caspian can have access to considerable yard and related facilities at Neka, in the southeast part of the Caspian.
Under the terms of the new Iran Petroleum Contract (IPC) presented to foreign and local companies at a conference in Tehran in late November, investors are offered special incentives for working on reserves that have priority because they are either shared with neighbouring countries or are considered to be in risky areas.
Senior officials in Tehran have told Upstream that in the Caspian, investors can work under agreements that are very similar to the internationally accepted production sharing agreement formula.
Iran’s section of the Caspian may contain at least 5 billion barrels of oil in place, according to estimates made earlier this century.
There may also be considerable gas reserves.
Most of the potential fields are in deep waters of about 1000 metres.
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