Iran planning more oil drilling

TEHRAN, Sept. 2 (UPI) -- One of the first oil fields likely on tap for post-sanctions contracts in Iran is on schedule for further exploration and production work, a director said.

SHANA, the Iranian oil ministry's news website, said the National Iranian Drilling Company secured the right to drill 20 wells over the next two years in the South Azaegan oil field.

China National Petroleum Corp was contracted to help develop the Azadegan complex, one of Iran's largest oil fields. It straddles the border with Iraq. The Iranian side complained about the lack of the deployment of drilling rigs from China and the CNPC contract for development was later torn up because the company wasn't meeting Iran's expectations.

The Iranians said their national oil company has now scheduled six drilling rigs for the purpose of developing the border area.

The first official tenders for oil field development are scheduled for late October with oil fields straddling the western border with Iraq among the early offers. According to Tehran, the border Azadegan complex holds around 6 billion barrels of recoverable oil reserves.

Drilling plans may complement Iran's ambition to defend a market share at a time when major producers are reviewing means to prop up the price for crude oil, which is down 8 percent from peak levels in August and around 50 percent lower than 2014 levels.

Iran in July produced around 3.6 million bpd, according to the Organization of Petroleum Exporting Countries, a level 17 percent higher than during the first quarter of the year when initial production considerations emerged.