• العربية
  • فارسی
Brand
  • Iran Insight
  • Politics
  • Economy
  • Analysis
  • Special Report
  • Opinion
  • Podcast
  • Iran Insight
  • Politics
  • Economy
  • Analysis
  • Special Report
  • Opinion
  • Podcast
  • Theme
  • Language
    • العربية
    • فارسی
  • Iran Insight
  • Politics
  • Economy
  • Analysis
  • Special Report
  • Opinion
  • Podcast
All rights reserved for Volant Media UK Limited
volant media logo

Iran Eyes Large Russian Gas Imports Amid Falling Output

Dalga Khatinoglu
Dalga Khatinoglu

Oil, gas and Iran economic analyst

Aug 12, 2022, 15:45 GMT+1Updated: 17:37 GMT+1
An Iranian gas production platform at South Pars in the Persian Gulf
An Iranian gas production platform at South Pars in the Persian Gulf

Iran's deputy oil minister says negotiations for Russian natural gas imports are in their final stages as Iran faces falling output in the Persian Gulf.

Mohsen Khojasteh-Mehr, who also serves as the head of National Iranian Oil Company (NIOC), told Fars news agency that converting the memoranda of understanding (MoUs), sealed between NIOC and Russian Gazprom cover various fields, including petroleum and gas swaps.

Iran and Russia in July agreed to $40 billion in trade and investment projects.

A swap means that Iran would import gas from Russia and deliver a certain quantity to another country that has a gas purchase deal with Moscow if it makes sense geographically or in terms of available infrastructure. In this case, among Iran’s neighbors only Turkey has a gas deal with Russia, but it has its own pipelines, much shorter in distance than a 2,000-kilometer longer route from Iran.

Buying Russian gas to cover shortages

This makes the Iranian claim of a gas swap strange. What appears to be more likely is Iran buying Russian gas to cover its own production shortages.

Russia, in turn, which has been buying gas from Central Asian countries as a middleman and exporting it, has a shrinking market after sanctions following its invasion of Ukraine. Existing pipelines that send the cheap gas from Central Asia to Russia can now be reversed and pump it to Iran.

Last year, Russia imported 10.5 billion cubic meters (bcm) of Turkmen and 4.6 bcm of Kazakh gas through these pipelines, according to BP statistics.

There are also two pipelines, connecting Turkmenistan to Iran's northeastern regions with 20 bcm/yr capacity together. Currently Turkmenistan delivers only 1.5 bcm/yr of its gas via these routes.

Fars news agency says Iran can import 20 bcm/yr of Russian gas for both domestic consumption and delivery to Iraq and Turkey.

Part of Iran South Pars gas production infrastructure
100%
Part of Iran South Pars gas production infrastructure

It seems the first variant is feasible, because Iran had 250 mcm/d gas deficit last winter (equal to Turkey's total daily gas demand in 2021) and every year the gap between its gas production and demand is growing.

Fars says Iran has consumed 9 billion liters of diesel and 6 billion liters of mazut in electricity generation last year, due to gas shortage. Iran can consume Russian gas in power plants to be able to export more diesel and mazut, making more profit, if the Russian gas is below regional prices.

Russia helping Iran in gas production?

Fars reported that another important MoU between NIOC and Gazprom is related to pressure enhancement of South Pars gas field in the Persian Gulf, shared between Iran and Qatar.

In the absence of Western technology, Iran has been unable to keep up production at the field, steadily losing out as its domestic consumption has increased.

Fars said if the sides finalize the MoU and sign an agreement, the contract value would be $10bn.

According to the NIOC, the Iranian section of South Pars gas field would pass the half-mark point of its life by 2023 and every year its production would decline 10 bcm. Iran and a consortium headed by French Total signed a $5-bn contract in 2016 to develop the South Pars, including the installation of a 20,000-ton platform with two giant compressors to prevent production decline.

Iran needs at least 10 to 15 such giant platforms (15 times bigger than the current active platforms) in South Pars. Each new platform costs $2.5 billion.

It is not clear how Gazprom would enhance the pressure of the gas field as only large Western energy companies can build the giant platforms with huge compressors.

When Total left the South Pars contract due to US sanctions, Chinese CNPC also abandoned the project due to its inability to build larger platforms. Gazprom also has no experience or the technology for such a project in the sea.

Qatar installed huge platforms, through contracts with Western companies, especially Total, and not only prevented a decline in production, but it has started new drillings to increase gas output by 30% in the next five years.

Regarding Iran's inability to prevent production decline from South Pars - a field that accounts for 70% of Iran's total gas output- it seems the country eyes Russian imports to compensate for the decline in South Pars and prevent further gas shortages in cold seasons.

Most Viewed

Iran negotiators ordered to return after internal rift over Islamabad talks
1
EXCLUSIVE

Iran negotiators ordered to return after internal rift over Islamabad talks

2
ANALYSIS

US blockade enters murky phase as tankers spoof signals and buyers hesitate

3
ANALYSIS

Why the $100 billion Hormuz toll revenue is a myth

4

US tightens financial squeeze on Iran, warns banks over oil money flows

5
ANALYSIS

US blockade targets Iran oil boom amid regional disruption

Banner
Banner

Spotlight

  • Hardliners push Hormuz ‘red line’ as US blockade tests Iran’s leverage
    INSIGHT

    Hardliners push Hormuz ‘red line’ as US blockade tests Iran’s leverage

  • Ideology may be fading in Iran, but not in Kashmir's ‘Mini Iran'
    INSIGHT

    Ideology may be fading in Iran, but not in Kashmir's ‘Mini Iran'

  • War damage amounts to $3,000 per Iranian, with blockade set to add to losses
    INSIGHT

    War damage amounts to $3,000 per Iranian, with blockade set to add to losses

  • Why the $100 billion Hormuz toll revenue is a myth
    ANALYSIS

    Why the $100 billion Hormuz toll revenue is a myth

  • US blockade targets Iran oil boom amid regional disruption
    ANALYSIS

    US blockade targets Iran oil boom amid regional disruption

  • Iran's digital economy battered by prolonged blackout
    INSIGHT

    Iran's digital economy battered by prolonged blackout

•
•
•

More Stories

Turkey Kills Senior Kurdish Commander In Syria With Iran’s Help

Aug 12, 2022, 15:17 GMT+1

Iran’s intelligence apparatus has cooperated with Turkey to kill an Iranian-born senior leader of the Kurdistan Free Life Party (PJAK) which seeks self-determination for Iran's Kurdish minority.

The so-called Amude-Derbesiye provincial leader of the PKK/YPG, Yusif Mehmud Rebani (Youssef Rabbani), code-named Rezan Cavit, was killed in a drone strike in the Syrian city of Qamishli by Turkey’s National Intelligence Organization (MIT) on August 6, Turkish media announced on Friday. 

The drone struck his car and killed at least four other people, including Mazlum Esat, code-named Ruhaz Amude, and wounded two more. 

"Commander Youssef Rabbani who was in Qamishil for a visit was confirmed dead in the attack," Hamrin Ali, the co-president of the local council of the Jazira region in the Kurdish-led Autonomous Administration of North and East Syria (AANES) said.

He joined the PKK in the 1990s, and in 2010 was part of the "Coordination Committee", the highest executive body of the Iranian branch of the organization, PJAK. MIT claimed he had also ordered the attacks against the Turkish armed forces during the period when the PKK was in charge of the Haftanin province. 

Generally, the Kurdish parties in Iran − including Komala and the Kurdistan Democratic Party of Iran (KDPI) − favor Kurdish autonomy within a federal Iran. Pejak (the Free Life Party of Kurdistan), an affiliate of the Kurdistan Workers Party (PKK), formed in Turkey but also based in northern Iraq, has generally favored a unified, independent Kurdistan uniting Kurds in Syria, Iraq, Turkey, and Iran.

Tehran Informed About US Lawsuit Against IRGC Over Downing Of Ukrainian Plane

Aug 12, 2022, 14:44 GMT+1

Switzerland has informed Tehran of a lawsuit filed against the Islamic Republic and IRGC in the US by families of victims of the Ukrainian plane shot down by Iran in 2020.

According to a document obtained by Iran International, the Swiss embassy in Tehran which represents US interests has officially informed the Iranian government of the lawsuit.

In June, Canada also announced that it has notified Iran of Ontario's Superior Court of Justice’s ruling that IRGC’s downing of Ukraine Airlines Flight PS752 was intentional.

100%

In May 2021, some family members filed a civil lawsuit against Iran and senior officials they believe were to blame for the incident. Canada’s Ontario Court ruled that the downing of the plane was an intentional act of terrorism and on December 31, 2021, awarded compensation to be shared by the estates of the six victims.

In June, Canada's international human rights parliamentary subcommittee criticized the government's “passive” approach toward Iran’s widespread human rights abuses in a House of Commons subcommittee meeting attended by several political and human rights activists – including the spokesman of the Association of Victims' Families, Hamed Esmaeilion.

The airliner was shot down by two air-defense missiles fired by the IRGC on January 8, 2020, as it took off from Tehran’s Imam Khomeini International Airport. All 176 passengers and crew, including 63 Canadians and 10 from Sweden, as well as 82 Iranian citizens on the plane died in the disaster.

Russians Being Trained On Iranian Drones, US Reiterates

Aug 11, 2022, 22:46 GMT+1

The US said Thursday that Russian officials have undergone training in Iran in recent weeks as part of an agreement on the transfer of drones from the Islamic Republic.

US State Department deputy spokesperson Vedant Patel reiterated during a phone briefing that Russian officials had conducted training on drones in Iran "in the last several weeks."

He said Washington would "vigorously enforce" its sanctions on both Russian and Iranian weapons trading as the transfers of drones between the two countries was "potentially sanctionable under numerous authorities," noting that "We remain incredibly concerned about Iran's use and proliferation of UAVs. They have been used to attack US forces, our partners in the region, and international shipping entities.”

Since last month, US officials have repeatedly said that Washington had information that Iran was preparing to provide Russia with up to several hundred drones, including some that are weapons capable, and that Russian officials had visited Iran to view attack-capable unmanned aerial vehicles (UAVs)

Iran has been supplying drones to its allies in the Middle East for a long time but selling drones to Russia to for its war in Ukraine has raised serious international concerns.

Iran's foreign minister denied the claim, including in a phone call with his Ukrainian counterpart but late In July, an Iranian lawmaker said the military cooperation between Tehran and Moscow has upset the political equations of the global order, confirming Russia’s request to buy Iranian drones.

US National Security Adviser Jake Sullivan warned twice in July that Moscow appears to be looking at buying Iranian drones and Russian officers even visited a drone base in Iran’s Kashan to review their options.

An adviser to President Volodymyr Zelensky told Iran International on July 25 that Russia and Iran are allies in the Ukraine war and it won’t be a surprise if Tehran supplies drones to Moscow.

Iranian Agents Threatened To Rape, Kill Students To Get Confessions

Aug 11, 2022, 21:40 GMT+1

Officers threatened to sexually assault two university students who are imprisoned in Iran on security charges, the brother of one them told Iran International.

In an interview with Iran International on Thursday, Reza Younesi said that his brother Ali Younesi and another student Amir Hossein Moradi were repeatedly threatened to be killed or raped by agents while they were incarcerated in solitary confinement.

Reza, who is based in Sweden, referred to a report by the Amnesty International released on August 4 that disclosed new details about the two, saying even their families were not aware of their situation and the ill-treatment because they were held in solitary confinement for nearly 60 days without any contacts with their families and lawyers.

According to an informed source cited by the Amnesty International, they “confessed” under the threat of death and sexual violence after being transferred out of Section 209 of Tehran’s Evin Prison to a location outside prison, where Ministry of Intelligence agents warned them prison regulations did not apply.

Amnesty International also said that after Branch 36 of the Appeals Court upheld their convictions and sentences on June 6, 2022, Ministry of Intelligence agents visited Amirhossein Moradi’s father and made vague promises about the possibility of his son’s release in exchange for agreeing to a “friendly” interview with state TV and publicly criticizing dissidents, which Amirhossein Moradi refused.

The two Sharif University award-winning science students were arrested in April 2020, with a judiciary spokesman announcing that explosive devices had been found in their homes and that they had links to “counter-revolutionary groups.”

After a grossly unfair trial, a Revolutionary Court in Iran sentenced the duo to 16 years in prison on April 25, 2022, over spurious national security charges such as “gathering and colluding to commit crimes against national security”, “spreading propaganda against the system [regime]” and “destruction of public property” for their participation in peaceful protests in January 2020 and their families’ real or perceived ties to exiled Albania-based opposition group Mujahideen-e Khalq (MEK). Their convictions were based on “confessions” which both men retracted in court and said were obtained under torture and other ill-treatment.

“The authorities violated their [Moradi and Younesi] right to be presumed innocent by publicly accusing them of ties to ‘counterrevolutionary’ groups apparently based on their families’ real or perceived association” with the opposition group MEK, Amnesty wrote in November 2021.

In a letter in January, several Nobel Laureates and leading academics asked United Nations Secretary-General Antonio Guterres and Human Rights High Commissioner Michelle Bachelet to petition Iran over Moradi and Younesi. In May 2021, more than 170 professors and students at Sharif University wrote a letter to the Iranian authorities demanding their release. Younesi won the gold medal in the International Astronomy Olympiad in 2018 in China, and Moradi was an award-winning physics student.

Argentina Arrests Four Iraqis Or Iranians With Fake French Passports

Aug 11, 2022, 18:26 GMT+1

Argentina has detained four “Iraqi” citizens with fake French passports at Ezeiza airport outside Buenos Aires since Monday. 

Security Minister Fernandez Anibal said on Wednesday that the four were arrested Monday night at the Ezeiza international airport as they tried to board a plane with false documents. The individuals intended to travel to the Netherlands on a KLM airline flight. 

Some reports said the two couples were of Iranian origin but it was not confirmed by any Argentinian official. The suspects were later identified as Iraqi Kurds, and members of the Yazidi religion who fled Iraq with the aim of establishing themselves in Germany via Amsterdam. 

He added their case is being investigated by the same federal judge in charge of the Iranian plane grounded in Argentina, Federico Villena. 

Villena is the same magistrate who is investigating the 14 Venezuelans and five Iranians who arrived in this capital in June on a plane from the Venezuelan state company Emtrasur, a subsidiary of Conviasa, grounded over links to Iran’s Revolutionary Guard. 

Earlier in August, Villena authorized the departure of 12 of the 19 people who were onboard, ordering four Iranians and three Venezuelans to be retained in Argentina.

Registered as a Venezuelan cargo plane, the aircraft was used by the Iranian company Mahan Air and transported a group of Iranian officials, including pilot Gholamrez Ghasemi, a senior executive of the airline Qeshm Fars Air, who is a member of the IRGC and a former board member of Fars Air Qeshm who stands accused of transporting weapons for Hezbollah during the civil war in Syria.