EghtesadOnline: Iran could export its first liquefied natural gas cargo from the Persian Gulf as early as next year, if it presses ahead with its proposed floating LNG production project.
National Iranian Oil Company has signed a contract with joint venture company IFLNG to deploy a 500,000-ton barge to liquefy gas from the giant South Pars field in the Persian Gulf and store and transfer the cargoes, LNG Shipping World news website reported.
IFLNG is a joint venture between Helma Vantage of Norway and Iran’s Kharg Gas Refining Company. They are talking to Belgium-based shipowner Exmar about a short-term charter for Caribbean FLNG.
Analysts at BMI Research say that the $600 million project would be “insignificant” in terms of volume, but would help Iran deepen its integration with partners in Asia and Europe, and build up the country’s experience in LNG trade and marketing, Financial Tribune reported.
“Iran could export its first LNG by the end of 2018, following an agreement to deploy the Exmar-owned Caribbean FLNG at Pars Service Port on Kharg Island,” BMI said.
Exmar has declined to comment. However, BMI argues that subject to financing and securing the vessel, the Kharg/Helma project could be ready to operate “in a short period”.
“Iran offers one of the fastest options to employ and monetize the currently redundant Caribbean FLNG vessel,” BMI said. “The facility was constructed to process natural gas, which has a high methane content of 97.6%. While the gas feed from South Pars is far wetter, with greater gas liquids and condensate content, methane from flared gas at nearby offshore projects is the targeted supply.”
Iran’s ambitions in the LNG area are not new. There were plans to develop LNG production projects in place in the early 2000s. International sanctions interrupted these plans, but now they are back on the table, unless the US imposes new sanctions on the country, Oil Price reported.
Until that happens, if it ever does, Iran has access to western oil and gas extraction technology, and has a relationship with French energy group Total who holds a stake in the South Pars mega project.
The French company signed the first new Iran Petroleum Contract to develop an offshore phase of South Pars. Total had also previously expressed interest in acquiring the Iran LNG project.