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  Iran to announce Bangestan oil field tender winner soon

Posted: 14 May 2003

TEHRAN (Dow Jones) — National Iranian Oil Co. (C.NIO), which plans to develop only one of the three delineated fields in the coveted Bangestan oil reservoir, will announce the winner of the tender offer to develop the Ahvaz field soon, reported the official Islamic Republic News Agency on Saturday.

"Initially, it was intended to have the development of the Bangestan oil reservoir in three fields of Ahvaz, Mansouri and Ab-teymour," said the head of state Oil Engineering and Development Co. Ali-Akbar Vahidi. "But due to the complexity of the field, presently (only) the development of Ahvaz field and detailed studies on Ab-teymour and Mansouri are intended," he said.

Bangestan, one of the biggest projects tendered by the National Iranian Oil Co., or NIOC, in 1988, is in southwestern Iran and the companies competing on the project are BP PLC's (BP) British Petroleum, Royal Dutch Petroleum Co. (RD) and the TotalFinaElf SA (TOT).

The full development of the three fields could take about a decade at a cost of around $3 billion with an estimated final production of 650,000 barrels a day.

"The technical reports submitted by the participating foreign companies in the tender have been examined and the financial packages have been opened and are being evaluated," he said adding that the winner will be announced "very soon" in the project.

According to Iran s oil minister, Bijan Namdar Zangeneh, the NIOC was supposed to announce the winner of the tender offer in March 2002. Vahidi said the delay in the announcement of the winner stems from repeated changes in the manner of the development of the reservoir by Iran. The changes include the imposition of fines for inadequate use of domestic expertise, a long-term commitment by the contractor and the inclusion of clauses for the correct use of the field to ensure maximum return.

Vahidi said Iran is looking forward to a production of around 260,000 barrels a day after the completion of the Ahvaz field in the reservoir. He didn't give the estimated development fee.

Posted by Richard Price, Editor Pipeline Magazine

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