TEHRAN: Gas production at Iran's giant offshore natural gas field South Pars will rise to 175 million cubic meters per day within the next two years, an energy official was quoted as saying on Sunday. Iran has the second biggest gas reserves in the world after Russia, but sanctions over its nuclear energy program and other factors have slowed its development as a major exporter. It is unable to access the technology it needs to build LNG facilities. "By the end of Iranian year 1391 (in the next 2 years) South Pars gas production capacity will increase to 175 million cubic meter per day," Ali Vakili, managing director of the Pars Oil and Gas Company (POGC), told semi-official Mehr news agency." Vakili did not say how much of an increase this represents. Production at the field rose by nearly 30 percent during the 2009-10 year, Iran's state Press TV reported last month, to around 59 billion cubic meters of processed gas for the full year, or around 162 million cubic meters per day. The second stage of a bond issue to finance the project opens on Monday, semi-official news agency ISNA said on Sunday. "Mellat Bank has placed the issuing of 1 billion euros ($1.33 billion) in four equal 250 million euro segments on its agenda. The release of the 10-day long second segment will begin Monday," it said, adding this was to finance phases 15 to 18. "The bonds — to come in 5,000, 50,000 and 100,000 euro denominations — will bear an interest of 8 percent, maturing in three years... POGC has already spent $30 billion on 11 phases and will need another $70 billion for the downstream and upstream development of the remaining phases," it added. Vakili said last month that POGC planned to issue bonds worth 3 billion euros and Iranian rial-dominated bonds worth around $3 billion. Iran has said it will go ahead and develop the field without major Western energy firms who had shown interest. "For developing South Pars we reached the conclusion that we should not wait for foreign companies because at the moment the capability to develop through domestic companies exists," Vakili said. Vakili said on April 26 that Royal Dutch Shell and Repsol had one week to decide on their involvement in the natural gas field. Iran says both Anglo-Dutch Shell and Spain's Repsol have procrastinated on finalizing their involvement in the field, the world's largest reservoir of gas. It has set similar deadlines in the past as a way of pressuring foreign investors. The offshore South Pars field contains about half of the estimated 28 trillion cubic metres of the country's gas reserves. South Pars is the Iranian side of the world's largest known gas reservoir not associated with oil production. Qatar holds the southern section of the field, where it is known as the North Field. Qatar has developed its side of the field to become the world's largest exporter of liquefied natural gas (LNG).
