Iran to Spend $70bn Developing Gas Fields

5 July 2009 (Last Updated July 5th, 2009 18:30)

The National Iranian Oil Company (NIOC) said that it plans to spend about $70bn in two key offshore natural gas fields in the 2010-15 period, a senior official said. Iran plans to spend $40bn to finish the remaining projects in the South Pars field during the fifth five-year economic pl

The National Iranian Oil Company (NIOC) said that it plans to spend about $70bn in two key offshore natural gas fields in the 2010-15 period, a senior official said.

Iran plans to spend $40bn to finish the remaining projects in the South Pars field during the fifth five-year economic plan, which runs until 2015.

Iran has increasingly moved to Asia, which in some cases still has available cash to spend and whose energy demand is anticipated to outpace that in the developed world.

Hojjatollah Ghanimifard, another Iranian official, told Reuters that Iran is in negotiations with Asian banks on a €1bn ($1.40bn) bond to finance the development of South Pars, as part of its pursuit of billions-worth of energy sector funding.

An additional $25bn would be invested in the North Pars field, Jashnsaz said.

"Altogether it looks like... Iran will invest some $70bn in these two fields, which is a very high figure, and no other field in the country is expected to have such high investment," Jashnsaz told state television.

He did not explain the difference between the $70bn figure and the total of $65bn that he said would be invested in the two fields.

An Iranian state company in May 2009 said that Iran planned to issue $12.3bn of foreign currency and rial-denominated bonds in the next three years to help finance South Pars.

Iran's five-year energy sector plan required investment totalling about $30bn a year, Ghanimifard told Reuters in an interview.