their talks, Zangeneh said: "The Brazilians have suggested that Iran
supply oil to a refinery which is planned to be built in that country. Iran has
also offered to Brazil's Petrobras the development of South Pars Oil
was not visiting Tehran for the first time. He travelled to Tehran in December
2016 when he said in a meeting with Zangeneh that strong banking relations
would guarantee oil and gas cooperation.
official visit was aimed at driving Iran-Brazil oil talks into a new phase.
These talks started in March 2015 when Iran's Deputy Minister of Petroleum for
International Affairs and Commerce Amir-Hossein Zamani-Nia welcomed Brazil's
then minister of development, industry and trade, Armando de Queiroz Monteiro
Neto, in Iran's capital. During those talks, Tehran expressed its readiness to
have cooperation with Brasilia in the manufacturing of downhole and wellhead
drilling equipment for the purpose of deep-water production, as well as in the
development of oil fields within the framework of new model of oil contracts,
known as "Iran Petroleum Contract" (IPC).
March, Zamani-Nia met with Brazil's Ambassador to Tehran Rodrigo de Azeredo
Santos and discussed grounds for oil and gas cooperation. The Brazilian side
had shown inclination for purchasing crude oil from Iran.
the last meeting between Zangeneh and Filho, Zamani-Nia told reporters that
there was potentiality for cooperation between the two countries in many sectors.
since cooperation between the two countries does not enjoy a long history, it
is a little bit difficult to prepare the ground for the start of
cooperation," he said.
said banking relations between Iran and Brazil would be reestablished soon after
an Iranian delegation comprising representatives from the Central Bank of Iran
and Iranian private banks travelled to that country.
Offered to Petrobras
said Brazil's state-run major Petrobras would send a delegation of managers to
Iran to discuss development of the South Pars oil layer and cooperation in the
Caspian Sea oil projects.
said Petrobras was equipped with required technology to develop the oil layer
of South Pars, but it lacked sufficient finance, at least for now.
Maersk had held talks for the development of the oil layer, but the purchase of
its oil stocks by France's Total worried Iran. The reason is clear: Total is
the operator of the Qatar-owned section of South Pars which is jointly owned by
Iran and Qatar. The two countries have been vying for recovery from South Pars
and Total's acquisition of Maersk would give rise to conflict of interests.
the coming three to four months, we will hold intensive trade talks with oil
companies," said Zangeneh.
interest in cooperation with Iran is not limited to oil and gas sector. The
South American major economy is also willing to manufacture electric and
gas-fueled buses in Iran.
and Filho also discussed manufacturing of oil equipment in Iran to be used in
Iran and also be exported to countries in the region.
"The Brazilians have said that a group of Brazilian industrialists are to
travel to Iran in coming months. Iran welcomes such a visit," he said.
Supply to Brazil Refinery
renewed its request for Iran to supply crude oil to a refinery it plans to
build in the future.
was agreed that an international consultant be hired by Iran to review the
Brazilian party's proposal in terms of its concerns and requests, and then give
its views," said Zangeneh.
planned oil treatment facility would be able to process 600,000 b/d of oil. A
Chinese company is to cooperate with Brazil in the financing and manufacturing
of this facility.
said Iran would welcome the Brazilians' cooperation in Iran's IPC-based oil and
gas projects. "It seems that the Brazilians are seeking to cooperate with
Iran in the refining sector."
have not so far exported products to the American market and the American
continent will be our final market for oil exports and this issue needs to be
studied," said the Iranian minister.
in Oil Projects
said after his talks with Zangeneh that examining opportunities and grounds for
cooperation between the two countries would be conducive to investment in oil
said representatives of Brazil's petroleum industry were intent on visiting
Iran, adding: "After considering request for the Brazilian companies'
technology and technical knowhow in Iran, we will review the expansion of cooperation."
the presence of Petrobras here and examining solutions would be of help in
future cooperation and investment," he said.
want to see what kind of help and which solution we can present in the
technology sector because we already know that Iranian companies and other
foreign firms like France's Total, which is a strategic partner of Petrobras in
the world, would be ready for investment in Iran's oil and gas projects,"
said that Iran's Zangeneh had welcomed Petrobras' cooperation in deep-water
drilling in the Caspian Sea oil projects.
Petrobras is drilling for oil and gas in the depths of nearly seven kilometers
offshore Brazil. Therefore, we have abundant savvy and technology in these
sectors and we hope to be able to work together here," said Filho.
will hold talks with Iran's ambassador to Brazil and also with our ambassador
here in Tehran in order to set a date for the future visit of a Petrobras
delegation which would examine grounds for cooperation," he added.
Zangeneh gave positive assessment of Iran's oil market, saying: "I see the
market in a balanced state."
compliance of members of the Organization of the Petroleum Exporting Countries
(OPEC) [with an oil production cut deal] is in good conditions and the members'
convergence about the supply cut agreement has not dropped over the past six
months and has been on the rise," he said.
between non-OPEC countries, particularly Russia, is good with regard to the oil
supply cut, and in my view the market is headed towards balance," said
global agreement for output cut will continue by the end of the current year
and there have been talks about its extension, but not finalized yet. But in my
view, the level of crude oil storage still remains high," he added.
said Iran welcomed cooperation with non-OPEC producers, adding:
"Cooperation does not mean oil production cut; however, it is unlikely
that Brazil would join the supply cut agreement under the current
Party Needed in IP Pipeline
also referred to Iran-Pakistan gas pipeline, saying he thought that Iran would
finally start pumping gas to its eastern neighbor.
based on our experience in recent years I think that a third party is needed to
settle the Iran-Pakistan deal (in terms of finance and other commercial
procedures)," he said.
means that a third company would agree to build the Pakistani side of the IP
pipeline so that we would have peace of mind with regard to payment of gas cost,"
Pakistanis say they don't have money to build their side of the pipeline and
there are concerns that even if the pipeline is built and gas is exported, they
may not have capacity to pay money to us for gas exports," said Zangeneh.
"A number of oil and gas companies in the world are willing to be engaged
in the IP project as third party; however, no conclusion has been achieved yet."
also touched on the resumption of crude oil swap, saying: "The important
issue has been the resumption of crude oil swap operations. We can have
cooperation with the three countries: Turkmenistan, Kazakhstan and Azerbaijan
in this regard. Of course, we are in the process of receiving oil from
said that swap deals are often for six months up to one year. He added that
changes of parameters and price criteria needed to be taken into consideration
in the swap deals.
swap operations, we compete with the Mediterranean market. Supplying oil in the
Persian Gulf market must be more profitable than cargoes headed via the
Mediterranean," he added.
said: "We are not after profits from crude oil swap operations and revival
of these operations is of higher significance to us."
Iran resumed crude
oil swap from the Caspian Sea after a seven-year hiatus.
operations, Iran will receive crude oil from the Caspian Sea littoral states at
Neka Port and deliver the same volume to clients in the Persian Gulf at Kharg
In the first swap,
360,000 barrels of crude oil was transferred from Neka to Tehran oil refinery.
oil swap project was halted in June 2010 at the order of then minister of
petroleum. But when Zangeneh took office as Iran's petroleum minister in 2013
he insisted on the revival of the project noting that oil swap would give Iran
a more active role in the oil trading of Caspian Sea states.
Oil Deal on Track
also said that Iran was waiting for Russia to start receiving crude oil
supplied by Iran.
has no problems in this regard. The Russian side had some banking issues, which
have been resolved to some extent. For us, the banking issues have been
resolved too," he said.
Zangeneh said a Russian
bank was expected to open a letter of credit (LC) and handle relevant payments.
Courtesy of Iran Petroleum