March 20 (UPI) -- The production of oil from the South Pars field complex in the Persian Gulf has started for the first time, the Iranian Oil Ministry declared.
Shana, the Oil Ministry's news website, reported production from seven oil wells in the South Pars complex began and should reach a net peak capacity of 35,000 per day in about a week. The oil ministry estimates the field, which Iran shares with Qatar, holds more than 14 billion barrels of oil.
Gholam-Reza Manouchehri, the deputy managing director at the National Iranian Oil Co., was quoted by Shana as saying production was made possible through a floating production storage and offloading vessel, or FPSO.
"By the time the FPSO recovers and processes a certain amount of crude oil from the South Pars oil layer, an oil tanker will berth next to it for loading," he said.
Royal Dutch Shell was among the first companies to buy Iranian crude oil in the era that followed the signing of a multilateral agreement that brought sanctions relief to Iran in exchange for agreements to scale back its controversial nuclear research program.
Last year, the National Iranian Oil Company said Dutch trader Trafigura was moving Iranian crude oil to the Chinese market, though Trafigura had no comment on the shipments at the time. The NIOC said it expected the first crude oil consignment from the South Pars field will be ready for shipment in about a month.
Iran is the only member of the Organization of Petroleum Exporting Countries with room for production growth under an agreement reached in November that aims to balance an over-supplied market. During the fourth quarter of 2016, Iran produced around 3.7 million bpd. Secondary sources reported to OPEC economists that Iran's output increased about 2.3 percent since then to 3.8 million bpd in February.