Iran flags timely major oil discovery

Iran flags timely major oil discovery
File image.

Iran has said it has discovered an oil field containing the equivalent of 53 billion barrels, potentially boosting its reserves as the OPEC member struggles to overcome the effects of sanctions on its energy industry.

It wasn’t immediately clear how much of the oil discovered in southern Khuzestan province is new, or how much of it can be developed commercially.

Domestic media reported the discovery yesterday, and the oil ministry said it plans to hold a news conference today to announce details of the find.

Iran currently ranks fourth in reserves worldwide — behind Venezuela, Saudi Arabia and Canada — with 155.6 billion barrels, according to 2018 data from BP.

However, the Islamic Republic’s exports of crude have plunged since the US re-imposed sanctions in 2018.

“What is important in this field is the rate of recovery, that is, how much of that we can extract and sell,” Iran’s IRIB news service cited President Hassan Rouhani as saying. “A higher recovery rate means more revenues for us.” The deposit lies onshore at a depth of 80 metres and covers 2,400 square kilometres, semi-official Tasnim News reported.

Elsewhere, Saudi state oil giant Aramco has said it will sell up to 0.5% of its shares to individual retail investors and will be restricted from issuing additional shares for a year after its IPO.

Aramco fired the starting gun on what is likely be the world’s largest listing last week after a series of delays. The offering, set to rank it as the world’s most valuable company, will begin on November 17, its newly-published prospectus said.

Crown Prince Mohammed bin Salman is seeking to sell the shares to raise billions of dollars to diversify the Saudi economy away from oil by investing in non-energy industries. Bankers think the long-awaited IPO will value Aramco around $1.5 trillion.

The prospectus did not include how much of the company would be floated in total or of any commitments from cornerstone investors.

The prospectus said that among the risks for investors were the potential for terrorist attacks and the potential for encountering antitrust legislation, as well as the right of the Saudi government to decide maximum crude output and direct Aramco to undertake projects outside its core business.

— Bloomberg/Reuters

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