Important information tables on Iranian OIL (why mess with nuclear energy?)

Oil
Iran is OPEC’s second-largest oil producer and the fourth-largest crude oil exporter in the world.	According to Oil and Gas Journal, Iran has 136 billion barrels of proven oil reserves, or roughly 10 percent of the world's total proven petroleum reserves as of January 1, 2007. Iran has 40 producing fields, 27 onshore and 13 offshore, with the majority of crude oil reserves located in the southwestern Khuzestan region near the Iraqi border. Iran's crude oil is generally medium in sulfur content and in the 28°-35° API range. Iran is OPEC’s second-largest producer after Saudi Arabia. In 2006, Iran produced an estimated 4.2 million barrels per day (bbl/d) of total liquids, of which 3.8 million bbl/d was crude oil, equal to 5 percent of global production. Iran’s oil consumption totaled 1.6 million bbl/d in 2006. The Iranian government heavily subsidizes the price of refined oil products which has contributed to increased domestic demand. Iran has limited refinery capacity to produce light fuels, and imports much of its gasoline supply. Iranian domestic oil demand is mainly for gasoline and automotive gasoils, but domestic demand for other oil products are declining due to the substitution of natural gas. However, it is an overall net petroleum products exporter due to large exports of residual fuel oil. Oil export revenues represent the majority of Iran’s total exports earnings, but the country suffers from budget deficits due to a growing population and large government subsidies on gasoline and food products. In 2005, the International Monetary Fund (IMF) estimated that energy subsidies accounted for 12 percent of Iran’s GDP, the highest rate in the world according to an International Energy Agency (IEA) study. Iran produced 6 million bbl/d of crude oil in 1974, but has been unable to produce at that level since the 1979 revolution due to a combination of war, limited investment, sanctions, and a high rate of natural decline in Iran’s mature oil fields. Iran’s oil fields need structural upgrades including enhanced oil recovery (EOR) efforts such as natural gas injection. Iran’s fields have a natural annual decline rate estimated at 8 percent onshore and 10 percent offshore, while current Iranian recovery rates are 24-27 percent, 10 percent less than the world average. It is estimated that 400,000-500,000 bbl/d of crude production is lost annually due to reservoir damage and decreases in existing oil deposits. Upstream Projects The Azadegan project phases I and II represent the greatest potential increase in Iranian crude oil production. Azadegan contains 26 billion barrels of proven crude oil reserves, but is geologically complex and difficult to extract. Iran and Venezuela have agreed on a $4 billion investment in the Ayacucho 7 block, where there are an estimated 31 billion barrels of oil. Iran’s Northern Drilling Company (NDC) has also worked with Russia’s Lukoil on oil field development in the Caspian Sea. (See Caspian Sea Analysis Brief) Iran plans to increase oil production to over 5 million bbl/d by 2010, but it will need foreign help. According to Global Insight, an estimated $25-35 billion is required to meet the government’s 5.8 million bbl/d target by 2015. Investment in Iran’s energy sector has been tempered due to the election of the conservative government of President Mahmoud Ahmadinejad in 2005, the international controversy surrounding the Iranian uranium enrichment and nuclear program, and economic sanctions. According to the IEA 2007 Medium-Term Oil Market Report, Iran will not be able to increase its net expansion capacity through 2012. U.S. Sanctions U.S. sanctions against Iran due to Iran’s historic support for international terrorism and its actions against non-belligerent shipping in the Persian Gulf impact the development of its petroleum sector. According to the Iran Transactions Regulations, administered by the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC), U.S. persons may not directly or indirectly trade, finance, or facilitate any goods, services or technology going to or from Iran, including goods, services or technology that would benefit the Iranian oil industry. U.S. persons are also prohibited from entering into or approving any contract that includes the supervision, management or financing of the development of petroleum resources located in Iran. Sector Organization The state-owned National Iranian Oil Company (NIOC) is responsible for oil and gas production and exploration. The National Iranian South Oil Company (NISOC), a subsidiary of NIOC, accounts for 80 percent of local oil production covering the provinces of Khuzestan, Bushehr, Fars, and Kohkiluyeh va Boyer Ahamd. Though private ownership of upstream functions is prohibited under the Iranian constitution, the government has allowed for buyback contracts which allow international oil companies (IOCs) to enter exploration and development through an Iranian affiliate. The contractor receives a remuneration fee, usually an entitlement to oil or gas from the developed operation. In August 2007, President Mahmoud Ahmadinejad appointed NIOC executive Gholamhossein Nozari to serve as Acting Oil Minister, replacing Vaziri Hamaneh and creating controversy over President Ahmadinejad’s role in the energy sector. Exports According to International Energy Agency’s Monthly Oil Data Service and Global Trade Atlas, Iran’s net crude and product exports in 2006 averaged 2.5 million bbl/d, primarily to Japan, China, India, South Korea, Italy, and other Organization for Economic Co-operation and Development (OECD) nations, making it the fourth-largest exporter of crude oil in the world. In 2006, Iran’s oil export revenues amounted to $54 billion. Export Terminals Iran has the largest oil tanker fleet in the Middle East, the National Iranian Tanker Company, which holds 29 ships including Very Large Crude Carriers. Kharg Island is the country’s largest terminal with a holding capacity of 16 million barrels of oil and a loading capacity of 5 million bbl/d, followed by Lavan Island with capacity to store 5 million barrels and loading capacity of 200,000 bbl/d. Other important terminals include Kish Island, Abadan and Bandar Mahshar, and Neka, which helps facilitate imports from the Caspian region. The Strait of Hormuz, on the southeastern coast of Iran, is an important route for oil exports from Iran and other Persian Gulf countries. (See Persian Gulf Analysis Brief) At its narrowest point the Strait of Hormuz is 34 miles wide, yet an estimated 17 million barrels, or roughly two-fifths of all seaborne traded oil, flows through the Strait daily. Iranian Heavy Crude Oil is Iran’s largest crude export at 1.6 million bbl/d followed by Iranian Light at 1 million bbl/d. Refining Iran’s total refinery capacity is 1.5 million bbl/d from nine refineries operated by the National Iranian Oil Refining and Distribution Company (NIORDC), a NIOC subsidiary. Iranian refineries are unable to keep pace with domestic demand, and face major infrastructure problems. The country plans to add around 985,000 bbl/d of refining capacity by 2012, mostly through expansions and upgrades for gasoline yields at the Bandar Abbas, Bushehr, and the 90-year-old Abadan refineries. Large expansion projects at Bandar Abbas, including new catalytic reformers, distillation units, and condensate splitters will help supply the domestic demand, but it will probably not eliminate all gasoline imports. Iran has also discussed joint ventures in Asia, including China, Indonesia, Malaysia, and Singapore to expand refining activity. Pipelines Iran has an expansive domestic oil network including 5 pipelines, and multiple international pipeline projects under consideration. Recently, an expansion of the 150 mile pipeline from the port of Neka on the Caspian coast to Rey, Tabriz, and Tehran refineries has reached a capacity of 300,000 bbl/d according to Global Insight. Iran has invested in its import capacity at the Caspian port to handle increased product shipments from Russia and Azerbaijan, and enable crude swaps with Turkmenistan and Kazakhstan. In the case of crude swaps, the oil from the Caspian is consumed domestically in Iran, and an equivalent amount of oil is produced for export through the Persian Gulf with a Swiss-trading arm of NIOC for a swap fee.
In 2006, Iran imported over 192,000 bbl/d of gasoline and relied upon imports to meet almost half of its fuel needs costing $5 billion.	Gasoline Iran is the second biggest gasoline importer in the world after the United States, consuming over 400,000 bbl/d. According to FACTS Global Energy, Iran imported over 192,000 bbl/d of gasoline in 2006 costing $5 billion. The gasoline consumption growth rate has averaged ten percent annually over the past six years, and the cost of imports is expected to reach $6 billion in 2007, up from $2.8 billion in 2005. Gasoline prices are heavily subsidized, and sold below the market price at around 42 cents per gallon, which has encouraged increased consumption. An increase in vehicle sales in recent years has also contributed to the problem. According to PFC Energy, car ownership in Iran grew 250 percent between 1990 and 2006, and a majority of these vehicles are older models. Gasoline powered vehicles in Iran are expected to reach 14.9 million by the end of 2007. Iran does not have sufficient refining capacity to meets its domestic gasoline and other light fuel needs. Therefore Iran imports gasoline from India, Turkmenistan, Azerbaijan, the Netherlands, France, Singapore, and the United Arab Emirates. Iran also imports from large, multinational wholesalers such as BP, Shell, Total, Vitol, LUKoil, and several Chinese companies. New Gasoline Rationing System In June 2007, the Iranian government instituted a gasoline rationing system. The decision followed a 25 percent price increase to 42 cents per gallon in May. NIORDC is responsible for the program which allows private cars to purchase 26 gallons per month and taxis to buy 211 gallons per month. The rations and increased costs are politically unpopular in Iran. Customers are allowed to purchase their ration six months in advance. Part-time taxis, commercial vehicles, and government vehicles also have special allowances. Records are maintained on smart cards, and later this year the government is expected to announce the price for gasoline bought beyond quota levels. Iran’s gasoline consumption dropped 30 percent immediately after the rationing scheme was adopted. NIOC executive, Hojjatollah Ghanimifard, stated that Iranian gasoline imports for August 2007 dropped 14 percent, although an additional $1.5 billion was requested by the Iranian Oil Ministry to increase gasoline imports through March 2008. The International Energy Agency reported in its August 2007 Oil Market Update that gasoline consumption will likely increase again due to the fact that Iran allows advance purchase of gasoline at a subsidized rate. The combination of rationing, price hikes, increased refining capacity, as well as compressed natural gas (CNG) production, will reduce Iranian gasoline import demand by an estimated 30,000 bbl/d in the next three years according to FACTS Global Energy.

Bush in Heaven by Fidel Castro Ruz

Posted on March 25, 2008 by dandelionsalad

Dandelion Salad

by Fidel Castro Ruz
Global Research, March 24, 2008

This reflection has two parts, both concluded on Saturday, March 22nd

Part I

In this reflection I will go by the news received from different sources, including international cable services, –without specifically recognizing any of them as the information source, but strictly abiding by the text of the news– books, documents, the Internet, and even questions asked to well-documented sources.

There is a big hustle and bustle everywhere, as if we lived in a mad house. Our very well-known characters continue on their hectic tour.

After visiting Brazil and Chile, Condoleezza flew to Moscow to sound out the new President. She wants to know his mind. She traveled with the chief of the Pentagon. With a dislocated arm after a fall on February, he said: “With a broken arm, I won’t be nearly as difficult a negotiator.” A typically Yankee joke. You may figure out the effect this had on the proud ears of a Russian, whose people suffered the loss of so many millions of lives in their struggle against the Nazi hordes which claimed for vital space –what we could call today cheap oil, raw materials, and guaranteed markets for surplus goods.

We have known of the adventures of McCain and Cheney in Baghdad; one of them hopes to become head of government, and the other, being already the deputy head of government, issues more orders than his boss. They were both welcomed with the most unexpected and violent predictions. They devoted less than two days to that, enough time to flood the world with sinister forecasts.

Bush was delivering speeches in Washington while the prices of gold and oil were sky-rocketing.

Cheney didn’t stop. He rushed for the Sultanate of Oman -774,000 oil barrels per day in 2005 and 780,000 in 2004. Last year Oman revealed its plans to invest 10 billion dollars during the next five years to increase its oil production to 900,000 barrels per day and reach the figure of 70 to 80 million cubic meters of gas per day. This is what the Sultanate authorities reported on January 15, 2007.

Cheney, accompanied by his family, sailed on board of the Sultan’s yacht “Kingfish I” on a fishing tour nearby the maritime boundaries between Oman and Iran. How bold! Nobel awards should also be given to those super-brave who run the risk of death or mutilation after a sumptuous private lunch with a fishbone stuck in the throat. The absence of the owner of the luxurious yacht spoiled the hero’s party.

McCain doesn’t stop either. He jumps into a helicopter to move around the territory where the Israeli soldiers, while chasing Palestinian leaders, continue to kill women, children, teenagers and youth in the West Bank with the use of sophisticated technical means. The Republican candidate is an expert on that.

He traveled to Jerusalem and there he promised to be the first to recognize that whole city as the capital of Israel, which the United States and Europe turned into a sophisticated nuclear power, whose satellite-guided missiles could fall in Moscow, more than 5000 kilometers away, in a matter of minutes.

There will be no oil or gas producing State that Cheney would not visit before he returns to attest to the happiness of the world before the President of his country.

Bush, for one, speaks on the 17th for one reason, then on the 18th for another reason, and on the 19th to mark the beginning of his fantastic war. Cuba, as it was to be expected, has not ceased to be at the crosshairs of his invectives.

In the midst of the chaos created by the empire, wars become inseparable sidekicks. It’s been five years since the beginning of the Iraqi war. Profound thinkers have estimated the amounts of persons who have been affected, and have calculated that this war’s total cost amounts to trillions of dollars. Four thousand army soldiers have lost their lives; for every soldier that is killed thirty more are wounded due to the kind of war that is being waged. White phosphorous and cluster bombs are the feed that nurtures this war on a daily basis. Anything goes, except for living.

Cheney and McCain compete with one another, one of them as the father of the creature, the other as the stepfather. They both meet with heads of State and exact compromises: oil and gas production should be increased, with the use of Yankee technology, Yankee inputs, and Yankee weapons from the industrial military complex. Yankee military bases should be allowed.

From Jerusalem, McCain jumps into London to talk with Gordon Brown. Before that, while speaking in Jordan, he made a mistake and asserted that Iran, a Shiite country, was helping to train Al Qaeda, a Sunnite organization. It’s all the same to him; he didn’t even apologize for his mistake.

Cheney jumps into Afghanistan. The war waged by NATO and the Yankees has turned the country into the largest opium exporter of the world. The USSR had worn itself out and plunged into a similar war. Bush launched his first belligerent blow there, supported by NATO.

They are doing all that needs to be done to convene two parallel meetings: one to discuss the fight on terrorism and a NATO meeting.

One thing is certain: Ban Ki-moon, the UN Secretary General, and Jaap de Hoop Scheffer, NATO’s top official, will meet with Hamid Karzai, President of Afghanistan on April 1, 2 and 3 in Bucharest to participate in the Trans-Atlantic Forum to be held in that city. At the same time there will be a conference convened by the GMF (the German Marshall Fund of the United States), the Ministry of Foreign Affairs of Romania, and Chatham House which will gather a great number of strategists and politicians to address topics of vital interest for NATO. According to the GMF Chairman, the conference will be attended by 9 Heads of State, 24 Prime Ministers and ministers, and 40 presidents of research institutions from Europe and the Americas, which make up the North Atlantic Treaty Organization (NATO) which dissolved Tito’s Yugoslavia and carried out the war in Kosovo. Anyone could understand that any similarity with the interests pursued by the Yankee imperialism is a mere coincidence. The situation in the Balkans, the anti-missile defense system, the energy supply and weapons control are unavoidable issues.

Since Bush needs to perform his main character role, he has already drafted his own schedule: he would be in the city of Neptun, in the Black Sea, to attend a meeting with Traian Basescu, President of Romania, on the eve of the opening of the conference. The fate of humankind which contributes surplus value and blood, are in those hands.

(To be continued tomorrow, in Part II)

Fidel Castro Ruz

March 22, 2008

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