TEHRAN, May 21 (UPI) -- Iran will invest $16 billion in development of the offshore South Pars gas complex over the next 10 months, a natural gas company director said.
Managing Director of the Pars Oil and Gas Company Mohammad Reza Zahiri said the company would use the financing to fund development plans aimed at raising gas production by as much as 1.7 billion cubic feet in the current Persian year, which ends in March.
Iranian President Mahmoud Ahmadinejad said the economy should diversify beyond natural resources in the face of sanctions pressure. Western countries have targeted Iran's energy sector with sanctions to limit finances used to develop its nuclear program.
"Lack of financial injection into South Pars phases is not true," Zahiri was quoted by the semiofficial Fars News Agency as saying. "We have managed to finance the projects with the support of National Development Fund, domestic banks and selling bonds."
He added that domestic contractors have acquired "valuable experiences" while under sanctions pressure that would give them the know-how to accelerate the development of the South Pars offshore complex.
The U.S. Energy Department acknowledges that Iran has the second-largest natural gas reserves in the world. Most of its gas is for domestic needs and the sector remains underdeveloped because of a lack of foreign investments.