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Iran to authorise $2.8 bln investment in Azadegan

TEHRAN, Dec 13 (Reuters) - Iran's draft budget bill for the new year starting March 2001 authorises up to $2.8 billion to be invested in the giant Azadegan oilfield through buy-back contracts, the semi-official Iran newspaper said on Wednesday.

With an estimated six billion barrels of recoverable reserves, Azadegan, located in the Iranian southwest, is the world's largest find since Russia found the 5.5 billion barrel Priobye in 1982.

The 520 sq km (200 sq mile) field has a production potential of 400,000 barrels per day and could earn total revenues of $100 billion given current estimates of recoverable reserves.

Iran has already given the go ahead to two Japanese oil companies, the Japan Petroleum Exploration Co (JAPEX) and Indonesia Petroleum Ltd, to submit offers for developing parts of the field and expects their offers by June 2001.

Oil ministry officials have said other interested firms could bid after the June deadline set for the Japanese firms, given priority status after talks between President Mohammad Khatami and the Japanese prime minister in Tokyo earlier this year.

Seismic data from the field was analysed by U.S. oil firm Conoco Inc , which has been subject to a Treasury department investigation following allegations that it may have breached U.S. sanctions against Iran by analysing the data.

Conoco has denied the allegations.

U.S. oil firms have gradually stepped up pressure on Washington to scrap the sanctions, which they say hurts them most, and expect their campaign to come to a head with the expiry of the Iran-Libya Sanctions Act next August.

Many Iranians are speculating that a confirmation of the Republican victory in the U.S. presidential elections may be the oil industry's best bet of easing restrictions on Iran.

George W. Bush has powerful industry links while Dick Cheney had said he supported the concept of renewing economic ties with Iran.


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