Official: Russia to invest $50 billion in Iran oil, gas

Russian investment in developing Iran’s oil and gas fields could total more than $50 billion, presidential aide Yuri Ushakov has said.

"Energy is the most promising sphere for cooperation between Russia and Iran. Leading Russian oil and gas companies such as Gazprom, Gazprom Neft, Rosneft, Lukoil, Zarubezhneft and Tatneft are systemically working on development of fields in Iran. The expected amount of investments is over $50 billion," he told reporters in Moscow Monday.

Last month, Iran awarded its second post-sanctions oil contract to Zarubezhneft to re-develop Aban and West Paydar oil fields in the country’s west.

PressTV-Russian firm to re-develop Iranian oil fields

Iran has awarded a contract to Russia’s Zarubezhneft to develop its Aban and West Paydar oil fields which are located in areas near the border with Iraq.

Iran’s Minister of Petroleum Bijan Zangeneh said the agreement was the first oil field development deal awarded to a Russian company and also the first oil deal sealed through the new format of Iran’s oil and gas contracts.

In February, Zarubezhneft signed an agreement with Iran’s IDRO Oil to jointly bid for the development of Susangerd oil field in southwest Iran.

Russian Energy Minister Alexander Novak said more than 10 different Iranian fields have been presented to Gazprom, Rosneft, Gazprom Neft, Zarubezhneft, Tatneft and Lukoil for development.

Russia and Iran signed six provisional agreements to collaborate on “strategic” energy deals worth up to $30 billion when President Vladimir Putin visited Tehran last November.

While Russia has been building up its energy assets in the Middle East as part of a wider push to expand its economic and military clout, Moscow and Tehran have a mutual interest in developing relations in the face of Western sanctions on both countries.

During Putin’s visit, Iranian officials said the two countries agreed to “strategic cooperation in the energy sector”, ranging from development of Iran’s oil and gas fields to collaboration on research.

Russia and Iran have also been working on oil-for-goods deals worth up to $20 billion but several dates on beginning the arrangement have been pushed back.

Iranian officials say the country needs $200 billion of investments for upstream and downstream projects by 2021. The biggest contract since the lifting of sanctions in 2016 has been with France’s Total to develop part of the massive South Pars gas field at a cost of $4.8 billion.

Free trade zone with Eurasian states

Ushakov also said an agreement to create a free trade zone between the Eurasian Economic Union (EAEU) and Iran may be signed within months.

"The talks on drafting a temporary agreement on the creation of an EAEU-Iran free trade zone have been finalized. The plan is to sign it within months," Tass news agency quoted him as saying.

Iran and EAEU members started to develop the agreement in 2015, though the signing has been postponed several times.

The Eurasian Economic Union includes Armenia, Belarus, Kazakhstan, Kyrgyzstan and Russia.

Armenia’s deputy minister of economic development and investment Hovhannes Azizyan said last month that the agreement might be signed by the end of May for a period of three years.

Iran’s Ambassador to Russia Mehdi Sanaei also said talks on the free trade zone agreement between the Eurasian Economic Union and Iran were close to completion.

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