Iran, Russia boost oil and gas ties ahead of Putin visit

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Moscow and Tehran are eyeing cooperation in over 10 oil and gas fields in Iran, a top official from the National Iranian Oil Company (NIOC) said last week, just days ahead of Russian President Vladimir Putin's forthcoming visit to the Islamic republic on Wednesday.

The head of NIOC's exploration directorate Seyyed Saleh Hendi told Russia's Sputnik news agency that Russian companies would be able to work more collaboratively with other countries. Russian companies with stakes in the Iranian oil and gas markets would be able to allocate more shares to establishing strategic alliances with European, Chinese and Southeast Asian companies.

"NIOC has already signed enough MoUs [memoranda of understanding] with Russian companies and now we are waiting for signing contracts and starting the execution of projects. According to the report I have received, NIOC has signed MOUs with Lukoil, Rosneft, Zarubezhneft, Tatneft, Gazprom and Gazpromneft and we are negotiating for more than 10 oil and gas fields development contracts,” Hendi said.

The NIOC official pointed out that cooperation on both offshore and onshore fields was under consideration. He also presented a list of oil fields that are the subject of talks between Iran and the Russian companies: Mansouri, Ab-Teymour, Kish, Yaran, Maroon, Southpars oil layer, Kupal, Aban, Esfandiar, West Paydar, Dehloran, North Pars, Azar, Changuleh and Cheshme Khosh.

National Iranian Oil Company (NIOC) and Russia’s Lukoil signed two memorandums of understanding on October 4, 2017, for conducting geological prospecting on Caspian Sea’s potential oil fields. /Lukoil Photo

The NIOC earlier this month signed two co-operation agreements with Russian oil giant Lukoil for conducting geological surveys in Iranian waters of the Caspian Sea, Abadan plateau and the northwest Persian Gulf area.

Commenting on the cooperation with Lukoil, Hendi said: "Since Iran has decided to use Russian companies' capabilities, NIOC is... negotiating with other companies, and in the event [these foreign companies and Iran] win the contract they will create a partnership with Lukoil," Hendi said.

He revealed that the foreign companies with which NIOC is negotiating are from China, Europe and Southeast Asia.

Hendi said that the technical negotiations with Lukoil on the Mansouri and Ab-Teymour oil fields had already been finalized.

Iran re-entered the global oil market following the landmark nuclear deal it struck in January 2016 with major global powers including Russia, China, the US, the UK, France and Germany which led to lifting of international sanctions against the Islamic republic.

However, Iran is also a member of the Organization of the Petroleum Exporting Countries (OPEC) and is a signatory to the producers' oil output cut deal reached in 2016, which is tightening the growth of Iranian oil production.

Putin to meet Iranian, Azerbaijani leaders in Tehran

From left: Iranian President Hassan Rouhani with his counterparts from Azerbaijan, Ilham Aliyev, and Russia, Vladimir Putin, during their meeting in Baku, Azerbaijan, on August 8, 2016. /AP Photo

Russian President Putin, who sees a strong potential for expanding Russia's oil and gas cooperation with Iran, will arrive in Tehran on November 1 to attend a trilateral summit with his counterparts from Iran and Azerbaijan, Iranian media reported on Saturday.

This will be Putin's first visit to Tehran following Rouhani's re-election as the Iranian President in May this year. The Russian President was also the first foreign leader to visit Tehran after Rouhani took charge for his first term in August 2013.

Russian Ambassador in Iran Levan Dzhagaryan, who announced the schedule of his president on Friday, said that Putin will also hold bilateral meeting with Iranian officials, Iran's Mehr news agency reported.

Azerbaijan's President Ilham Aliyev will arrive in Tehran on Wednesday as well.

The three leaders had earlier met for a trilateral summit in the Azerbaijani capital Baku in August 2016 to discuss a new transport corridor and other economic projects in the Caspian Sea region.

The Caspian Sea region has gained significance in recent time amid growing interest by global players, including China, owing to its geostrategic location and huge oil and gas reserves.

(With input from agencies)