1st Gas/LNG Production Contract for Iran

1st Gas/LNG Production Contract for Iran
ID : N-520 Date : 2017/10/26 - 10:22

(Persia Digest) – The first gas sales contract to produce LNG for exports has been signed between NIOC and IFLNB (under ownership of Kharg Island refinery and Norwegian company Hemla).

The Caribbean FLNG project will be developed in partnership with the Belgian Exmar and the leasing of an FLSU by IFLNG from it as their exclusive representative, with a capacity to produce 500 tons of LNG per year.

The National Iranian Oil Company and IFLNG have taken the necessary steps to implement the 20-year contract for the sale of natural gas within three months. It is predicted that the Caribbean FLNG unit will be moored offshore in Pars service port from September 2018. The FLSU unit will be ready to store an estimated 2.3 million cubic meters of LNG per day produced at the South Pars Gas seventh refinery.

The Caribbean FLNG has already completed its testing process in China and is the second carrier in the world that can produce LNG at sea. According to reports by internationally recognized institutes, it is expected that the construction of three other FLNG floaters will be completed by 2020.

On 27 October 2017, Petroleum Minister of Iran Bijan Zangeneh announced the price of natural gas for sale to small-scale LNG units, as well as gas compression units for exports. This contract has been signed based on the announcement in order to develop the overall energy exports from Iran and is the fastest effective step for Iran's presence on the global LNG markets.

Due to limited transport capacityies by pipelines, part of gas exports from Iran to longer distances, especially to Europe, must take place as LNG by sea. This requires the set up of special infrastructures and equipment.

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