Iran's Azadegan oil field adds another 50,000 b/d of production

Iran's crude output has increased by at least 50,000 b/d from its massive Azadegan oil field which straddles the border with Iraq, state news agency IRNA reported March 26, indicating a 35% increase in the field's production since July.

Oil minister Mohsen Paknejad said that executive works at one of the extracting units in Azadegan was completed on March 19 before the new Iranian year started.

"This made it possible to increase crude oil production by more than 50,000 b/d," Paknejad said.

"We started the year 1404 with oil production increase and this trend will continue," he added.

He did not specify the total production from Azadegan which has been divided in two southern and northern parts. Recent reports put the figure at least at 192,000 b/d, including the new 50,000 b/d.

The Petroleum Engineering and Development Co., which is developing the field, previously reported a 2,000 b/d output increase in January. The company had put the total output from South Azadegan at 140,000 b/d in mid-July, behind its original plan of reaching 320,000 b/d for 2023. The field is equipped with a processing facility for the extra volume.

US sanctions

The country's oil industry, hit by US sanctions, suffers from a cash shortage and old technologies. Crude production was 3.23 million b/d in February, making it the third-largest producer after Saudi Arabia and Iraq, according to the latest Platts OPEC+ survey by S&P Global Commodity Insights.

"We are working on a conference to introduce investment opportunities for investors within a month," Paknejad said.

The Azadegan oil field holds 32 billion barrels of oil in place.

PEDEC said that the company has a vast integrated plan for South and North Azadegan to produce much more crude in the long run, oil ministry news service Shana reported March 25.

"This project with an investment of $10 billion involves the second development phase of North and South Azadegan and our goal is to reach a stable 550,000 b/d oil production within eight years," PEDEC's Managing Director Nasrollah Zarei said, as reported by oil ministry news service Shana.

"We hope that executive work will start in the month of Farvardin," he said, referring to the current Iranian month that ends April 20.

The Yadavaran oil field is also part of the plan to increase oil extraction from shared reserves with Iraq.

"This project will start with drilling 24 oil wells and we have a target of 45,000 b/d of oil within the next two years," Zarei said.

He also pointed to Sepehr and Jofeir oil fields which have been designed to see a 30,000 b/d oil production jump in the current Iranian year. The two had added 14,000 b/d of oil to the country's production in March.

"We have two active projects with the Russians. One of them in its first phase has been carried out successfully and we are currently in the stage of stabilizing the production. The second project plans to increase output by new drillings," Zarei said, without mentioning the name of the fields.

Iran's initial plan for the past six months was to raise output by 250,000. Hamid Bavard, managing director of the National Iranian Oil Co., said Jan 11 that the company has fulfilled more than 100,000 b/d of the target.