Friday, October 23, 2015

Gazprom says prospects of Iranian gas entering European market very distant

The prospects of Iranian gas entering the European market are very distant, Gazprom Deputy Chairman of the Management Committee Alexander Medvedev said Friday.

"If there are such prospects, they are very distant and can relate to residual volumes of Iranian gas if a route to Europe is available," he said.

So far, there is every indication that Iran has other priorities in the gas sector: almost the entire volume of natural gas produced in the country is directed to ensure the growing needs of the domestic market and used for industrial purposes in oil production. The remaining volumes are exported, mainly to Turkey.

To increase exports of Iranian natural gas, companies would need to significantly increase its production, Medvedev said. "In the current circumstances and in the short term solving this problem will not be easy - Iran needs to overcome the technological gap caused by the destructive impact of economic sanctions on the oil and gas sector," he said.

For example, the Iranians are engaged in the construction of the country's first LNG plant, but were forced to suspend works, although the facility was half ready. In favorable circumstances and in the case economic sanctions against Iran are lifted, the first LNG plant can be put into operation only in 2019-2020, Medvedev added.

As for now, exports of Iranian pipeline gas seem more advantageous. The most attractive foreign markets for pipeline gas are near - very receptive markets of Pakistan and India, according to Medvedev.

Nevertheless Gazprom is certainly interested in interaction and cooperation with Iran, he concluded.


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