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NIOC to Issue Rls. 20,000B of Bonds to Finance Oil Projects

Source: 1/11/2021, Location: Asia

The CEO of the National Iranian Oil Company said NIOC was planning to issue Rls. 20,000 bn worth of bonds to finance projects aimed at production enhancement and maintenance of oil fields in Iran.

Addressing a ceremony to sign contracts for production enhancement and maintenance of NIOC on Monday, Masoud Karbasian said the project was put on the agenda by Iranian Minister of Petroleum Bijan Zangeneh and was endorsed by the Economic Council back in 2018.

Afterwards, 10 contracts were signed in the same year to be followed by 13 others. This time, 8 more contracts have been signed with a total value of $1.2 billion and with the aim of enhancing production by 95,000 b/d.

He said that 33 packages of the plan to maintain and increase oil production include 29 onshore projects and four offshore projects, and expressed hope that with the full implementation of 33 packages, the country's daily oil production capacity will increase by about 280,000 barrels.

Signing contracts with 22 Iranian firms

Referring to the maximum use of the potential of Iranian companies in the implementation of these projects, Karbasian pointed to the presence of 17 competent companies in the field of exploration and production, 16 drilling companies and 22 EPC companies ranked first in Iranian tenders. “A total of 31 contracts have been awarded to 22 Iranian companies.”

He estimated the total value of the contracts awarded in these 31 projects at $3.7 billion.

The CEO of the National Iranian Oil Company, referring to the average of 30% progress of 10 contracts in the first phase of the maintenance and enhancement of oil production, said: "The progress of projects is closely monitored through NIOC’s project management system.”

72% Share of Domestic Manufacturers

Karbasian stated that another advantage of this plan is the maximum share of domestic manufacturing, and added: "By implementing the localization plan of 10 groups of widely-used oil items, which started off in the Iranian Ministry of Petroleum back in 2014, it is possible to tap the potentialities of Iranian manufacturers in three parts: wellhead equipment, downhole equipment and seamless pipes."

He said the share of domestic production in the plan to maintain and enhance oil production is 72%, and said this share is expected to reach more than 80% by the end of the contracts. According to the official, 18 drilling rigs are currently active in the plan, which will increase to 55 rigs with the activation of all 33 contract packages.

Karbasian said the allocation of 4% of the contracts’ value to fulfill social responsibilities is another benefit of this national plan.

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