Iran to soon start supplying natural gas to Oman: Iran oil minister

Bijan Namdar Zanganeh. Photo: Bloomberg file

Muscat: Iranian Oil Minister Bijan Namdar Zanganeh has announced that Iran will soon begin supplying gas to Oman, as per the agreement reached between the two countries.
"Gas negotiations with Oman are over and as both sides have agreed, Iran will export 20 million cubic meters (mcm/d) of gas per day to Oman in the near future," Zanganeh said on Saturday, according to Iran's Fars news agency.

In August 2013, Zanganeh and his Omani counterpart signed a Memorandum of Understanding (MoU) to accelerate the delivery of shipments called for in the gas contract between the two sides.

Further, in September 2013, managing director of the National Iranian Gas Company (NIGC), Hamid Reza Araqi, explained that once the contract is signed, Tehran and Muscat will need 2.5 to 3 years to build the required infrastructures for supplying Iranian gas to Oman.

He also said that the National Iranian Gas Company  was studying different aspects of the issue, including economic assessments of the contract and a report on possible shipment routes.

After several years, reaching agreement on gas pricing is a breakthrough, the NIGC managing director said, adding that the two countries have many common interests for boosting cooperation, including supplying Oman's LNG units with gas.

Meanwhile, Salim Nasser Said Al Aufi, undersecretary of Oman's Ministry of Oil and Gas, recently said that the tender to prepare the feasibility study of the project to build a 260-km-long pipeline that will carry Iranian gas to Oman, has not yet been finalised.


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Having been involved in the GCC gas industries for more that 25 years , it would be highly unwise to proceed in such project due to the following :-

1- The development of gas production versus the demand growth in Iran do not allow for export in economical bases .
2- The need for more gas to be diverted to EOR in Iran far exceed the need to export gas for long term
3- The experiences from other countries dealing in the same issue proves that such agreement will not take place in the ground and will be limited to papers and courts rooms .
4- The costs related to gas prices and transportation will make it as costly as LNG , thus no economics benifits for both parties

It is so funny that Oman will buy gas from Iran at international prices and sell it as LNG with losses ... why would they do that , do not they have energy consultant who can direct them away from such agreements . All Oman has to do is to claim force Majuro and shut down the LNG plant .