Following the recent announcement of a new giant oil discovery in Iran;
Will Scargill, Managing Analyst, Oil and Gas at GlobalData, a leading data and analytics company, offers his view on the effect this will have on the country’s oil sector:
“Limits on investment and exports due to sanctions mean that the exploration successes at the Namavaran field can’t translate into material benefit. Iran already has a large number of projects holding billions of barrels of resources that it cannot fully realize, and this just adds to that list.
“The headline figure of 53 billion barrels also masks a more modest reality. The government has stated that 22 billion of this is newly discovered and due to the challenging nature of the reservoir only 10% of the total resources are thought to be recoverable.
“The government will reportedly look to develop the field alongside others that lie above the newly identified reservoir. However this would likely come at the expense of production from other fields and only reach a small portion of the field’s capacity.”