Eric Watkins
Senior Correspondent
LOS ANGELES, May 26 -- An Iranian oil executive has warned Japanese companies against delaying development of Azadegan oil field, suggesting that the massive project could be transferred to China or another country.
Mehdi Bazargan, managing director of Petroleum Engineering & Development Co. (PEDC), a subsidiary of National Iranian Oil Co., said the deal called for significant work completion by September, barring which "the contract will be terminated automatically."
PEDC manages project negotiations with Japanese companies.
"Extending the deadline is not written in the contract. We haven't thought of it," Bazargan told Japan's Kyodo News in Tehran. Asked if Iran could turn instead to China or another country, Bazargan said, "What is available in the market we will use, of course."
Inpex Corp. and its partners want to start production from the field in 2007 and plan to produce more than 400,000 b/d eventually, but key project phases have not been implemented.
Inpex, Tokyo, says the project has been delayed because Iran has not removed all land mines in critical areas.
Bazargan agreed that NIOC is obligated to remove mines. "But I don't think the main obstacle is mine-clearing or demining," he said.
The US, which is trying to bring international pressure on Iran to abandon its nuclear ambitions, opposes the $2 billion oil development deal between Japan and Iran.
US Ambassador to the United Nations John Bolton said Iran is using its oil and gas reserves to manipulate Japan, and he questioned Tokyo's decision to help develop Azadegan field (OGJ Online, May 22, 2006).
Contact Eric Watkins at [email protected].
