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a brief profile of the NIOC the third largest producer of oil
Type State-owned
Founded 1948
Website www.nioc.com
1. B Oil. Iran accounts for an estimated 10% of global proven oil reserves
(approximately 136 billion barrels). Most of the crude oil reserves are in the
southwestern region near the Iraqi border. Among the Organization of the
Petroleum Exporting Countries (OPEC) members, Iran is the second largest
oil producer following Saudi Arabia. In 2006, Iran produced about 4.2 million
barrels per day (mbd), approximately 5% of total global production. Iran also
is the fourth largest exporter of crude oil worldwide, after Saudi Arabia,
Russia, and Norway.Net crude and product exports in 2006 totaled 2.5 million
barrels per day and $54 billion revenues.
Top export markets for Iran are Japan, China, India, South Korea, and Italy.
More than 40% of the world’s oil traded goes through the Strait of Hormuz, a
channel along Iran’s border. The Strait of Hormuz is considered a global
“chokepoint” because of its importance to global energy security. It is a
narrowchannel with a width of only 21 miles at its widest point through which
largevolumes of oil are shipped.While oil export revenues have spiked in
recent years due to a surge in oil prices, Iran’s oil output has remained
essentially flat.
The government has set a goal of 5 mbd, which is still below the 6 mbd pre-
revolution capacity. Oil production has been hindered by a number of factors.
First, the oil industry faces the high rate of natural decline of mature oil fields;
the decline rate is 8% for onshore fields and even greater at 10% for offshore
fields. Second, oil recovery rates in Iran average between 24% and 27%,
much less than the world average. It is believed that millions of barrels of oil
are lost annually because of damage to reservoirs and these natural declines.
Additionally, structural upgrades and access to new technologies, such as
natural gas injections and other enhanced oil recovery efforts, have been
limited by a lack of investment and access to new technology, due in part to
U.S. sanctions. The United States is restricted from oil development
investments in Iran, but other countries, until recently, have actively invested
in Iran’s oil and gas sector development. Internally, oil export revenues are
used to finance government subsidies and cash handouts to the poor. Of
primary concern to the United States and the international community is the
use of oil export revenues to finance Iran’s nuclear program and support for
terrorist groups. Surplus oil earnings are directed to the Oil Stabilization Fund.
to William Knox D'arcy by Mozaffarol din- Shah of Qajar for production of
crude oil across Iran- except in five northern provinces. Hence, Iran became
the first country in the oil-rich Middle East region to start the oil operations.
Iran’s oil industry is now preparing to enter the second century of its life cycle.
1. C History
Iran’s oil industry, as a technical and industrial phenomenon, opened the
doors of the modern sciences for the Iranians in the past century. It also acted
as a foundation for political, economic and social development of the country.
To examine each event, we need to take a look at what has been going on in
the country in the past century.
Some of the events which are of prime importance in NIOC history are:
Production of crude oil from the first well drilled in Masjed Soleiman field in
1908; construction of Abadan oil refinery in 1913; unsuccessful revision of the
D'Arcy concession in 1933; oil nationalization in 1950 and finally inconclusive
talks with a consortium of oil firms in 1945 which led to domination of
foreigners on Iran’s oil reservoirs and the wasteful utilization of the country's
oil resources in 1961 Victory of Iran’s Islamic revolution in 1979 put an end to
some of the tragic events faced in the oil industry. It also led to replacement of
foreign workforce with Iranian one in the industry following the heavy
damages inflicted on the country’s oil industry during the eight-year Iran-Iraq
war, the reconstruction job started to compensate for the damages.
2. A Production
The year 2003 and early 2004, in the
period after Islamic Revolution, are
considered to be the period with the
highest production rate.
Out of this production, 18 percent was
from offshore and 82 percent from
onshore oil fields. This is the first time in
the last 25 years that such a production
ceiling has been achieved.
The year 2003 and early 2004, with
respect to natural gas production is a
significant period. This is due to a 12.6
percent growth compared with 2002
and the daily production rate reached to
378 mmscm/d. It can be also seen that
natural gas liquid (NGL) and
condensates production, in 2003, has enjoyed a 24 percent growth rate
compared with the previous year. The daily production rate which has been
recorded in NIOC production fact sheet , amounts to 42.27 thousand cubic
meters/day (266 mb/d).
Asmari &
1 Ahwaz 65.5 25.5 945
Bangestan
2 Maroun Asmari 46.7 21.9 520
Asmari &
3 Aghajari 30.2 17.4 200
Bangestan
4 Gachsaran Asmari & 52.9 16.2 560
Bangestan
Asmari &
5 Karanj 11.2 5,7 200
Bangestan
3. b Human Force
In order to recruit and maintain its skilled human force, NIOC has steadily
developed and performed comprehensive policies and plans.
In the year 2003, NIOC staff have had 52096 and 3470790 man hour on-the-
job training respectively abroad and at home. One of the other training
activities on human force is scientific links with some reliable local and
overseas universities. To receive the required training and update various
arenas of petroleum industry, such industry techniques, such as
administration, finance, services, operation and upstream industry techniques,
staff have been dispatched aboard.
It is worth mentioning that in 2003, through coordination with Petroleum
Industry University, 41 and 155 employees attended Bsc, Msc and Phd
courses respectively at local and overseas universities. The per capita training
for NIOC staff, in 2003, amounted to 81.7 man hour that compared with the
same figure in previous years, has enjoyed a suitable growth rate
4. Upstream Activities
4. A Exploration
Yadavaran (Kushk+Hosseinieh) 17 3
Ramin 6.28 NA
Azar 2.07 NA
Paranj 1.6 NA
Changoleh 0.944 NA
Asaluyeh 0.525 NA
Arvand 0.500 NA
Tusan 0.470 NA
Arash 0.168 NA
Total 71.458 NA
Field's Name
Trillion cubic Billion cubic Trillion cubic Billion cubic
feet meters feet meters
Tabnak 30 850 NA
Balal-Dahroum
8.8 250 NA
Formation
Zireh 1 28 NA
Arash 0.79 22 NA
activities so that bidding in international and local tenders, the company has
been awarded various drilling projects .
In 2003 and early 2004, through installing advanced systems on drilling rigs
and equipping them with top drive and also renovation of many rigs, the
company has managed to drill 127 wells totally amounting to 278,666 meters.
It is worth mentioning that as a result of this operation in yeas 1997-2003,
more than 880 exploration, delineation and development wells, amounting to
1,730,000 meters were drilled. Since its establishment in 1979 till 2003, NIDC
has managed to drill 2 million meters wells.
References:
1. http://www.nioc.ir/index.html
4. http://www.eia.doe.gov/emeu/cabs/Iran/pdf.pdf