Minister boasts of rapid oil expansion

Iran Times

10 years ago

June 20-2014

SLIDING — Iran’s monthly output has been growing in recent months and the government says it can go back to 4 million barrels a day in just three months. But notice it wasn’t 4 million before the sanctions hit in 2012. Monthly production was sinking slowly for years because the industry could not maintain aging oilfields and stop their decline.

Oil Minister Bijan Namdar-Zanganeh says oil production could reach 4 million barrels a day in “less than three months” after Western sanctions are lifted.

But Iran’s oil production has not been that high in many years. In the years before heavy sanctions were imposed on Iran in 2012, total production was sliding month-after-month while exports held steady at 2.5 million barrels a day. Oil specialists said Iran’s poor maintenance of old oilfields meant the ability to pump was declining with every passing month.

Iran would periodically bring a new oilfield on stream but it could not do that fast enough to stem the decline.

That makes it difficult to believe that Iran could get production up to 4 million barrels a day any time soon—especially given that the lack of investment since 2012 means fewer new fields have been developed while aging fields are presumably still declining.

According to independent estimates by Platt’s and the International Energy Agency (IEA), Iran’s output in recent months has been about 2.8 million barrels a day.