[Premium] Total Presents Tenders for Iran Field
The French energy major Total has presented officials from Iran’s oil ministry and local companies with details of four tenders it has issued to select subcontractors for the South Pars 11 project, which it won the right to develop and operate with a 50.1% stake for 20 years in July.
It was the first contract Iran has signed based on the newly-designed contract model, called the Iran Petroleum Contract. Total’s partners are Chinese CNPC with 30% and local Petro Pars with 19.9%.
Recently, Total issued four tender packages on the project, including building and installing the jackets and topsides, construction of under-sea pipelines as well as platform transportation and installation.
Total told NGW that since the November 2016 heads of agreement, Total has been conducting engineering studies on behalf of the consortium and initiated calls for tender in order to award the contracts required to develop the project by the end of the year.
According to an official document, prepared by Iran’s oil ministry and seen by NGW, the first phase includes two platforms, 30 wells, five pipelines and a mooring buoy.
The project will include two 32-inch pipelines, each of 136 km, to carry 56mn m³/d (20.5bn m³/yr) of sour gas to onshore gas processing plants. There will also be two 4.5-in pipes of the same length to carry and recover ethylene glycol, used to dehydrate the gas, and a 36-in pipe of 4.5 km length to transit 80,000 b/d of condensate to a mooring buoy where it will be loaded on to tankers.
The first phase will cost $2bn and be operational in 40 months.
An oil ministry source told NGW that so far, the only local companies to have bid for tenders are Iranian Offshore Engineering and Construction Company (IOEC), Saffgroup and Iran Shipbuilding & Offshore Industries Complex (Isoico). Six other companies including three Chinese and Italian Saipem are among competitors.
IOEC confirmed its bid to NGW and said that the company has had experience in phases 12-15 and 18-21 of South Pars in engineering, equipment purchase, installing jackets and platforms and piping. Saffgroup also said that it has experience in development of South Pars field’s oil layer and its 890 metric ton topsides and it hopes to win a tender. Isoico could not be reached but it participated in platform projects of phases 17 and 18 of South Pars.
The contract stipulates that local companies, services, materials and equipment must supply at least half the contracts. “The foreign companies may win the tenders, but they should also recognise this ratio in developing the project,” he added.
The second phase includes enhancing the recovery rate as well as building 20,000-mt platform (instead of 1,500 mton platforms in the first phase) with huge compressors to prevent gas output declining when the pressure of South Pars decreases in 2023. The new platform with compressors would cost $2.5bn, based on initial estimates.