Iran has finalised technical issues with China's Sinopec on developing its Yadavaran oil field but legal and economic details are still being negotiated, a senior Iranian official said on Saturday.
Gholamhossein Nozari, managing director of state-owned National Iranian Oil Company (NIOC), also told reporters energy major Shell was still in talks about the possibility of taking a stake in Yadavaran. Sinopec group, state-owned parent of Sinopec Corp, agreed in October 2004 to take the lead in developing Yadavaran and to buy 10 million tonnes of liquefied natural gas (LNG) a year for 25 years. Like other oil deals in Iran, talks have been protracted.
Shell has said it helped prepare a development plan for Yadavaran and had an option to participate in the project. "The technical study has been finalised (for Yadavaran). We have some legal and economic issues that are pending. I have invited the COO (chief operating officer) of Sinopec to come and finalise these issues," Nozari said. He did not give a date.
Asked about Shell's interest in taking a stake, Nozari added: "They are discussing this together with us." The Yadavaran field is expected to produce 300,000 barrels per day of crude. Shell has previously said it had "political concerns" about some new investment plans in Iran.
Economists have said foreign firms are increasingly wary of investing in the Islamic Republic after the United Nations slapped sanctions on the country over a nuclear row. The West says Iran is seeking atomic bombs, a charge Tehran denies.
Iranian officials have brushed off the impact of sanctions and insist foreign firms are still eager to invest in Opec's No 2 oil producer. "We had $17 billion in contracts last year and that shows we are attracting investors," said Nozari, speaking on the sidelines of a conference in Tehran.
He added that other deals worth $36 billion were being discussed with foreign firms but did not list them all. Alongside the talks on Yadavaran, he cited negotiations with China's China National Offshore Oil Corp (CNOOC) to develop Iran's northern Pars gas field as one of the deals under discussion. An Iranian official previously said a deal with CNOOC could be finalised in late August.