OMV Says Iran Gas Deal Talks Going Well

Source: Tehran Times 5/15/2007, Location: Asia

OMV said negotiations with Iran on a major gas deal were going well. OMV signed a preliminary agreement with Iran last month to develop an area of its giant South Pars gas field, build a liquefied natural gas (LNG) terminal and export the fuel. Iranian media reports said the deal could be worth up to $30b over 25 years.

OMV plans to lift 3 billion cubic meters of gas per year for delivery to European markets from the LNG terminal, Langanger said.

LNG is gas cooled until it becomes liquid, enabling shipment in special tankers.

OMV is also pushing ahead with plans to develop Iranís Mehr oilfield, Langanger said. Development will start later this year and OMV is targeting first oil output from the field in 2010, he added. The project will cost several hundred million dollars and output will total about 40,000 barrels per day, he said.

OMV is the operator of the Mehr block with a 34 percent stake. Spainís Repsol YPF and Chileís Sipetrol each have 33 percent stakes.

Drilling at the Shabwa basin in Yemen was going better than expected and the company may exceed its production targets, Langanger said.

"The drilling is going beyond expectations and depending on further drilling we could produce more," he said.

OMV would like to participate in future sour gas production in the United Arab Emirates, he said, speaking at a news conference to mark the opening of an OMV office in the UAE capital Abu Dhabi.

OMV would not be involved in a giant $10b sour gas project that Abu Dhabi tendered in April, but was hoping to get involved in projects in about five years, Langanger said.

OMV is also looking for opportunities in projects to boost oil recovery from the regionís oilfields, he said.


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