Iran Says Wants to Create Market for Caspian Crude
LONDON, May 31 (Reuters) - Iran intends to become a major consumer of
Caspian Sea crude oil to bolster economic and political ties with its northern
neighbours, a senior Iranian oil official said on Wednesday.
"Iran could guarantee at least a 500,000 barrels per day (bpd)
market inside the country for crude oil from Kazakhstan, Azerbaijan and
Turkmenistan," said Hossein Kazempour Ardebili, senior adviser to
Oil Minister Bijan Zanganeh.
To secure the barrels, Iran is poised to enter into long-term swap or
purchase deals with Kazakhstan and Azerbaijan, politics permitting, Kazempour
said at an oil seminar.
In Kazakhstan, Tehran is willing to engage in 20-year guaranteed pacts
for crude oil swaps or purchases.
As for Azerbaijan, Iran would buy or swap 220,000 bpd of Azeri crude
oil from state oil compoany SOCAR or from the partners in the Azerbaijan
International Operating Company (AIOC) on a long-term basis.
To gear itself up for the crude influx, Iran intends to adjust and expand
its existing refining and pipeline network in the northern part of the
As a first step, Iran aims to increase the capacity of an existing pipeline
which runs from the Caspian port of Neka to Tehran to 50,000 bpd within
six months. That line could be further expanded to 115,000 bpd within 18
months, he said.
Construction of a new $220 million Neka crude oil pipeline with capacity
of 370,000 bpd could be completed by 2002. Iran is also gearing up to
hoist capacity at its northern refineries at Tabriz, Tehran and Arak to
about 800,000 bpd.