Plans are underway to extend oil and gas development studies in the Sea of Oman for the next five years in search of hydrocarbon deposits in the region, the deputy head of exploration department at the National Iranian Oil Company said.
“Iran has so far not drilled in the Sea of Oman. But this will change under the auspices of the next economic development plan (2016-21),” Bahman Soleimani said, adding that early appraisals point to huge oil and gas reserves in the region, Shana reported on Saturday.
NIOC’s exploration department is working in tandem with the Research Institute of Petroleum Industry to expand studies in the undeveloped Sea of Oman. Studies include geological surveys close to Iran’s Makran Coast stretching along the Sea of Oman.
The official said that the second phase of oil and gas studies in the Sea of Oman is being planned and will be carried out in the near future.
“The volume of oil and gas reserves in the Sea of Oman is yet to be estimated, but based on initial findings we predict significant energy reservoirs.”
According to reports, drilling in the Sea of Oman could go as deep as 3,000 meters.
Persian Gulf Development
The small steps for tapping into the Sea of Oman reserves come as Iran makes new inroads in the Persian Gulf oil and gas exploration/production projects.
In 1990, Iran discovered the huge South Pars Gas Field in the Persian Gulf, which turned out to be the world’s largest gas field joined by the North Dome, the Qatari part of the field.
South Pars is the world’s largest gas field shared by Iran and Qatar, covering an area of 3,700 square kilometers of Iran’s territorial waters in the Persian Gulf. It adjoins Qatar’s North Field, which measures around 6,000 square kilometers.
Moreover, a consortium of OVL, Oil India and Indian Oil Corporation discovered huge amounts of gas reserves in the Persian Gulf in 2008. The discovery was later named Farzad-B.
However, the consortium could not obtain the permission to develop the field due to international sanctions against Iran’s nuclear program. Following the easing of sanctions in January, India has held several rounds of negotiations on the issue with Iranian officials.
Farzad-B Gas Field holds an estimated 508 billion cubic meters of in-place reserves, of which 370 bcm can be recovered.
Stumbling Blocks
To explore its potentially massive hydrocarbon deposits in the Sea of Oman, Iran needs costly offshore drilling technologies. Some of the biggest deepwater drilling operations are carried out in major offshore fields, notably the North Sea, the Gulf of Mexico and Azerbaijan’s Azeri–Chirag–Gunashli oilfield in the Caspian Sea.
Iran is simply absent when it comes to developing oil and gas in the Caspian Sea. In the past several years, extraction of oil and gas from the Caspian Sea has increased significantly by the other littoral states. Iran’s share has remained zero.
Saleh Hendi, director of drilling operations at the National Iranian Oil Company, has cast doubt on the feasibility of finding underground reserves in the Sea of Oman anytime soon.
The official said in August that high costs of exploration are a deterrent to upstream petroleum projects in the Sea of Oman.
More geological surveys need to be conducted in the region, he said. “The costs and risks associated with (oil and gas) exploration is increasing in the world and we may not be able to afford to develop very large reservoirs for now.”
Energy consultancy group Wood Mackenzie said in a forecast this week that global spending on oil and natural gas exploration will fall to the lowest level in 12 years in 2017, with some upstream projects in the Middle East region expected to be affected by the spending cuts.