UPI Energy Watch

Iran, Malaysia ink deal

Iran expects to finalize the contract to develop the Ferdowsi offshore oil field with its Malaysian counterpart in the next seven months, an Iranian oil official said Wednesday.

Morteza Elahi, an official at Pars Oil and Gas Co., was cited as saying by IRNA on the sidelines of the deal between his company and Malaysia's SKS Co., the contract signed between the two sides is binding like other deals with Malaysians and it would prepare the ground for inking the MDP final contract for implementation of the project for development of the offshore field.

He said the in situ oil reserves in Ferdowsi oil field, which is one of the biggest heavy crude and gas fields of Iran, are estimated at 31.7 billion barrels.

He added that the deal signed by Iran and Malaysia comes on the heels of a $16 billion contract signed recently with Malaysia's SKS company for development of the gas sector of Golshan and Ferdowsi fields.

The official said under the buyback-based final contract, all phases for development of the field, including reserves study, drilling, onshore transfer and preparation for exports or delivery to refineries, will be undertaken by Malaysians under supervision of Pars Oil and Gas Co.

He said the Malaysian party would finance the project and would take the original capital out of revenues gained from sale of the products. Up to 70,000 bpd of crude are expected to be obtained from the field, he added.

Ferdowsi oil and gas offshore field is located southeast of Bushehr and the Persian Gulf coast.

Iran, Turkmen talks on gas exports stalled

Iranian Minister of Oil Gholam-Hossein Nozari said Wednesday that Iran will not hold talks with Turkmenistan on prices as long as Ashgabat does not resume its gas exports to Tehran.

Talking to reporters here on Wednesday, Nozari said: "Gas and oil are not the only criterion for relations among countries, rather, there are other factors involved, which are also the yardstick in dealing with Turkmenistan."

Asked whether the country's diplomatic apparatus has actively dealt with disruption in Turkmen gas exports to Iran, Nozari said: "The diplomatic organ has actively dealt with the issue to the extent that the foreign minister and his deputies are engaged in discussions with the Turkmen party. National Iranian Gas Company, on the other hand, is following up the issue."

He said as the Turkmen party has maintained, technical problems had been behind the halt to its gas exports to Iran.

"What the Turkmen party has expressed officially as the reason for halt to its gas exports to Iran is technical problem. They maintain they are trying to remove the technical problem," he added.

The minister said people's attempts to economize on their gas consumption had been the most appropriate response to Turkmenistan.

Norway, Russia discuss cooperation

Russian and Norwegian officials met Thursday to discuss border and energy cooperation.

Norwegian Foreign Minister Jonas Gahr Store met with regional Gov. Yuri Yevdokimov to hold talks on further cooperation, Itar-Tass reported.

The meeting is expected to pay main attention to Russian-Norwegian regional and border cooperation. Following the end of the meeting, Store and Yevdokimov will participate in the signing ceremony of a Memorandum of Mutual Understanding between the Norwegian energy company StatoilHydro and the Murmansk Region.

After the signing ceremony, the Norwegian minister will go to Kirkenes where he will participate in events on Jan. 11 devoted to the 15th anniversary of founding Barents Secretariat.

The fact that Store starts the new year with a visit to northern areas and Murmansk shows importance, given by the Norwegian government, including the Foreign Ministry, to the development of cooperation in the Extreme North (Barents Sea). The Norwegian authorities repeatedly stated over the past few years that the development of northern territories is among priorities in the activities of the present government.

Store said in an interview with Itar-Tass late last December that the year 2007 "was successful in Russian-Norwegian bilateral relations. … Bilateral cooperation develops quickly and positively on the whole," he noted. "To get convinced of this, it is necessary to go to the Extreme North -- to Norwegian Kirkenes and Russian Murmansk."

"We have boosted our trade relations in 2007. Gazprom invited the StatoilHydro Company to participate in developing the Shtokman deposit," Store continued, stressing that "this opens an additional potential for further cooperation between the two countries in the energy sector."

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Closing oil prices, Jan. 10, 3 p.m. London

Brent crude oil: $93.97

West Texas Intermediate crude oil: $95.05

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