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EghtesadOnline: Production from the oil layer of South Pars, the giant gas field shared between Iran and Qatar in the Persian Gulf, has exceeded 1 million barrels in less than two months, managing director of Petroiran Development Company (PEDCO) said Saturday.

“The second crude oil cargo from the field is expected to be shipped out by the end of May,” Roham Qasemi was quoted as saying by Shana.

Regarding export of the first crude consignment from the oil layer earlier this month, Qasemi noted, "The extraction operation via an advanced $300-million floating production, storage and offloading (FPSO) vessel, the FPSO Cyrus, started in April and since then 22,000 barrels per day have been drawn on average."

A FPSO is a ship-shaped vessel, with processing equipment on the deck as well as hydrocarbon storage units. After processing, the offshore facility stores oil or gas before offloading periodically to shuttle tankers or transmitting processed petroleum via pipelines, Financial Tribune reported.

According to Qasemi, Iran aims to stabilize production from the SP layer at 25,000 barrels per day and gradually boost output to 55,000-60,000 bpd.

"The buyback contract to develop the first phase of the venture was signed between the National Iranian Oil Company and PEDCO in 2004," the official said, adding that the NIOC recently appointed Pars Oil and Gas Company (POGC) as the new contractor of the second development phase of the oil layer until ongoing talks with oil giants yield results.

The oil layer is located 130 kilometers off Iran's coast in the Persian Gulf with an estimated 7 billion barrels of oil in place.

  Prospective Candidate

According to Gholamreza Manouchehri, the deputy for development and engineering affaris at the NIOC, negotiations with Maersk Group to carry out the second phase of the project have not come to fruition yet.

"Maersk is a potential candidate for the venture as the company has advanced horizontal drilling technology," he said.

Maersk produces oil from the Danish and UK sections of the North Sea, Qatar, Algeria and Kazakhstan. It supports global oil and gas production by providing modern drilling services to oil companies around the world.

"Giants such as Maersk can provide us with quality drilling services," said the official.

Maersk has drilled more than 300 wells and extracted more than 1 billion barrels of oil for Qatar from the Qatari section of South Pars, which is known as the North Dome. According to reports, French energy major Total S.A. took over drilling and production operations in the North Dome from Maersk last year.

Maersk reportedly held talks on the South Pars project in 2001, but oil officials in Tehran ultimately handed over the project to PEDCO.

South Pars Iran oil PEDCO Roham Qasemi