Russia’s Krasnye Barrikady said on Thursday that it had won a contract worth $1 billion from Iran to construct five offshore drilling rigs for the country.
Reuters has quoted an unnamed official at Krasnye Barrikady as saying that the rigs are planned to be used in Iran’s section of the Persian Gulf shelf.
The official added that discussions over the project had been going on for almost two years.
The terms of the contract dictate that the project will also make use of Russian funds, Reuters said.
Iran is set to make a 15 percent down payment on the $200 million price of the first rig it has ordered, it added.
On the same front, the media in Tehran have reported that the rigs will be constructed in Russia as modules and will be assembled in Iran through reverse engineering by domestic companies.
The media also say the construction of a total of 10 rigs through the same scheme is on the agenda.
The name of the Iranian contract that will be working with Krasnye Barrikady has not been disclosed. However, the head of the Russian company told the media in Moscow last December that his company had signed a contract with country’s major shipbuilder ISOICO over the construction of oil facilities and technology transfer.
Under the agreement, the two sides will jointly build rigs for exploration and production of hydrocarbons in the Persian Gulf waters, it was reported at the time.
“We are ready to provide ISOICO with the necessary equipment thanks to financial and insurance support of the Russian government,” Krasnye Barrikady CEO Alexander Ilyichev said.
“The construction cycle is planned not for one year, but for decades," Ilyichev added.
New drilling rigs are expected to increase Iran’s ability to increase its crude oil production.
Figures show that the country is currently producing about 3.6 million barrels per day of which above 2 million barrels are exported.