Iran LNG liquefaction deal signed

“This contract, worth €700 million, will be implemented in two phases. The first phase will take 31 months and the second 36 months,” the oil ministry news agency quoted Deputy Oil Minister Ali Kordan as saying. “In this contract, the client is Iran LNG Company and there are two consortia including Iranian Farab/HFEC (HuaFu Engineering Company) of China and also Iran’s PIDECO with a multinational company” Kordan said. According to Kordan the project will be operational in January 2011. The project, called Iran LNG, includes two production trains, which will be fed 995 million cubic feet/d from phase 12 of the South Pars gas field.

Iran split its first LNG project into seven packages, and the liquefaction contract was the last part of the project that remained unsigned. The division into separate packages was designed to reduce the cost of the project, estimated at $4.35 billion. The project is to yield 10.5 million mt/year of LNG. Iran’s Rah Sahel will construct the jetty, South Korea’s Daelim will build storage tankers, the gas sweetening operations will be taken care of by Iran’s Farab, the off-site and utility segments will be handled by Iran’s Petro Sanat Maad and the power plants will be handled by Iran’s MAPNA. The shareholders in Iran LNG are: the National Iranian Gas Exports Company (49%), the Pension Fund Organization (50%) and the Pension Fund Investment Organization (1%).

Iran plans to float shares in Iran LNG and has been talking to Austria’s OMV and other European companies, to make them shareholders in the project in a bid to reduce its financial burden. Iran LNG will also produce propane, butane, gas condensates and sulfur. (Fars News Agency, Iran)