Russian firms are stepping up exports of crude oil to Iran.
The latest deal, involving OAO Lukoil's preliminary agreement for a long-term supply of Russian crude oil to Iran, follows a $167.45 million deal struck in December to supply 45,000 b/d of Russian crude to a Chinese-led consortium for refining in Tehran and Tabriz.
Iran has been positioning itself as a transit point for crude oil from countries bordering the landlocked Caspian sea, and it has arranged a series of swaps whereby Caspian oil is received for northern Iraqi refineries, and equivalent amounts of Iranian oil are exported through terminals on Iran's Persian Gulf coast (OGJ, Mar. 5, 2001, p. 74, and OGJ Online, June 30, 2000).
Lukoil deal
Lukoil has confirmed plans to sign a long-term contract with National Iranian Oil Co. (NIOC) for the supply of up to 1 million tonnes/year of crude oil to Iran beginning in March.
"We are in the process of negotiating now, but I can confirm that we are going to supply oil to Iran," Lukoil spokesman Dimitri Dolgov told OGJ.
"This is a new export route for Russian oil," Dolgov said, adding that oil produced by Lukoil subsidiary Nizhne- volzhskneft will be shipped from ports in Astrakhan and Volgograd for use "in Iran's northern regions."
The crude oil will be transferred by ship to Iran's Caspian port of Neka and carried via the 16-in. Neka-Sari pipeline completed last year in Iran under the technical direction of a Chinese consortium led by China Petroleum & Chemical Corp. (Sinopec) and China National Petroleum Corp. Ltd.
Ali Reza Baba'i, in charge of Iran's project for transferring Caspian oil, said in December that capacity of the new pipeline would be as much as 50,000 b/d this month.
The Neka-Sari pipeline is the first phase of a three-phase project under which Iran hopes to increase throughput of Caspian oil to as much as 500,000 b/d, all of it delivered by ship to an enlarged terminal at Neka and piped southward.
About 115,000 b/d will be added after completion of a 32-in. pipeline from Sari to Veresk, Iran, while another 270,000 b/d will be added after completion of another 32-in. pipeline to Ray, Iran. With additional pumping stations, officials say, about 500,000 b/d eventually will be piped from Neka to Ray.
Lukoil shipped a first consignment of 30,000 tonnes of oil last November and is now supplying Iran with about 100,000 tonnes/month. Altogether, Lukoil expects to ship some 1 million tonnes/year.
Caspian competition
Valery Golovushkin, president of Lukoil International Trading & Services Co., which sells Lukoil crude and oil products, underlined the Russian breakthrough by saying that this market is "highly restricted" due to competition from Kazakhstan and Turkmenistan. "We work in tough competition with these countries," Golovush- kin told Interfax earlier this year.
The point was driven home last April, when Iranian President Mohammed Khatami discussed construction of a pipeline to import crude oil from Kazakhstan via Turkmenistan to Iran at a cost estimated at $1.2 billion.
Cutting out Russia altogether, the projected pipeline would have an estimated capacity of 1 million b/d and extend some 1,500 km, including 700 km in Kazakhstan, 240 km in Turkmenistan, and 500 km in Iran.
