Sanctions on Iran are because of Southern Pars gas field, not its nuclear program

I started writing these blogs in June 2012. Over the years my focus remained on Iranian nuclear program, which is often termed the main cause of sanctions. However, when I posted my last blog on Leviathan gas field, offshore gas project of Israel, it dawned that the real cause of sanctions on Iran is its Southern Pars gas field, not the nuclear program. I quickly accessed Wikipedia and managed to put together some information.  

Pars field comprising of Southern Pars and North Dome fields is a natural-gas condensate field located in the Persian Gulf. It is by far the world's largest natural gas field, with ownership of the field shared between Iran and Qatar.

According to the International Energy Agency (IEA), the field holds an estimated 1,800 trillion cubic feet (51 trillion cubic metres) of in-situ natural gas and some 50 billion barrels (7.9 billion cubic metres) of natural gas condensates.

On the list of natural gas fields it has almost as much recoverable reserves as all the other fields combined. It has significant geostrategic influence.

This gas field covers an area of 9,700 square kilometres (3,700 sq miles), of which 3,700 square kilometres (1,400 sq mile) (South Pars) is in Iranian territorial waters and 6,000 square kilometres (2,300 sq mile) (North Dome) is in Qatari territorial waters.

The field is 3,000 metres (9,800 feet) below the seabed at a water depth of 65 metres (213 feet), and consists of two independent gas-bearing formations: Kangan (Triassic) and Upper Dalan (Permian). Each formation is divided into two different reservoir layers, separated by impermeable barriers. The field consists of four independent reservoir layers K1, K2, K3, and K4.

According to International Energy Agency (IEA), the combined structure is the world's largest gas field.

In-place volumes are estimated to be around 1,800 trillion cubic feet (51 trillion cubic metres) gas in place and some 50 billion barrels (7.9 billion cubic metres) of natural gas condensate in place. With in place volumes equivalent to 360 billion barrels (57 billion cubic metres) of oil (310 billion boe of gas and 50 billion boe of natural gas condensate) the field is the world's biggest conventional hydrocarbon accumulation.

The field recoverable gas reserve is equivalent to some 215 billion barrels (34.2 billion cubic metres) of oil and it also holds about 16 billion barrels (2.5 billion cubic metres) of recoverable condensate corresponding of about 230 billion barrels (37 billion cubic metres) of oil equivalent recoverable hydrocarbons.

The gas recovery factor of the field is about 70%, corresponding of about 1,260 trillion cubic feet (36×1012 m3) of total recoverable gas reserves which stands for about 19% of world recoverable gas reserves.

The estimates for the Iranian section are 500 trillion cubic feet (14×1012 m3) of natural gas in place and around 360 trillion cubic feet (10×1012 m3) of recoverable gas which stands for 36% of Iran's total proven gas reserves and 5.6% of the world's proven gas reserves.

The estimates for the Qatari section are 900 trillion cubic feet (25×1012 m3) of recoverable gas which stands for almost 99% of Qatar's total proven gas reserves and 14% of the world's proven gas reserves.

Since the field is a common field and the reservoir is highly homogenous, the ultimate recoverable reserves of each country may vary from this technical assessment which only considers the static data and does not include rate of gas migration. Therefore, it is better to say that the ultimate recoverable reserves of each country would be a factor of cumulative gas production by each of them.

The Iranian section also holds 18 billion barrels (2.9 billion cubic metres) of condensate in place of which some 9 billion barrels (1.4 billion cubic metres) are believed to be recoverable, while Qatari section believed to contains some 30 billion barrels (4.8×109 m3) of condensate in place and at least some 10 billion barrels (1.6 billion cubic metres) of recoverable condensate.

The South Pars Field was discovered in 1990 by National Iranian Oil Company (NIOC). The Pars Oil and Gas Company, a subsidiary of NIOC, has jurisdiction over all South Pars-related projects. Field development has been delayed by various problems - technical (i.e., high levels of mercaptans and foul-smelling sulfur compounds), contractual issues and, recently, politics.

Gas production started from the field by commissioning phase 2 in December 2002 to produce 1 billion cubic feet per day (28 million cubic metres per day) of wet gas. Gas is sent to shore via pipeline, and processed at Assaluyeh.

As of December 2010, South pars gas field's production capacity stands at 75 million cubic metres (2.6 billion cubic feet) of natural gas per day. Gas production at South Pars rose by nearly 30% between March 2009 and March 2010. The field's reserves are estimated at 14 trillion cubic metres (490 trillion cubic feet) of natural gas and 18 billion barrels (2.9 billion cubic metres) of natural gas condensates.

NIOC is planning to develop the field in 24 to 30 phases, capable of producing about 25 billion cubic feet (710 million cubic metres) to 30 billion cubic feet (850 million cubic metres) of natural gas per day. Each standard phase is defined for daily production of 1 billion cubic feet (28 million cubic metres) of natural gas, 40,000 barrels (6,400 m3) of condensate, 1500 tons of liquefied petroleum gas (LPG) and 200 tons of sulfur.

However some phases have some different production plans. Each of the phases is estimated to have an average capital spend of around US$1.5 billion, and most will be led by foreign oil firms working in partnership with local companies.

 

 

Israeli military readying Plan B to counter Iran

After a five-month pause in talks between the United States and Iran is set to resume on Monday, with the other parties to the nuclear deal mediating in hope of reestablishing an agreement to curb the Islamic Republic’s nuclear ambitions.

The defense establishment does not see a war breaking out with Iran or its proxies, such as Hezbollah in Lebanon, but the IDF has been keeping an eye on the North and on the South. It held large-scale exercises in the North in October and November, and there are plans to hold 50% more drills next year than in 2020, and 30% more than in 2021.

The increased exercises set for 2022 follows years of stagnation, and will be the largest training operation in five years, especially for reserve forces. Following the signing of the Abraham Accords, the IDF has also begun conducting drills with Gulf Arab states.

In a subtle message to Iran, Israel took part in a multilateral maritime security drill in the Red Sea with the United Arab Emirates, Bahrain, and US Naval Forces Central Command’s (NAVCENT).

The drill in early November was the first of its kind, and showed what kind of naval coalition Israel might join should there be military action against Iran.

“It is exciting to see US forces training with regional partners to enhance our collective maritime security capabilities,” V-Adm. Brad Cooper, Commander of NAVCENT, US 5th Fleet and Combined Maritime Forces said. “Maritime collaboration helps safeguard freedom of navigation and the free flow of trade, which are essential to regional security and stability.”

There are also hints of an aerial coalition that could come together. Israeli jets recently escorted a B-1B strategic heavy bomber and KC-10 re-fuelers on their way to the Gulf. Jets from Egypt, Jordan, Bahrain and Saudi Arabia also escorted those planes while flying through their respective airspace.

Israel’s Blue Flag air drills, which become more popular as the years go on, also provide a clue as to what other countries could fly alongside Israel when push comes to shove.

This year’s Blue Flag saw aircraft from Germany (six Eurofighters), Italy (five F-35 jets and five G550 planes), Britain (six Eurofighters), France (four Raphale jets), India (five Mirage jets), Greece (four F-16 jets), and the US (six F-16 CJ jets) take part.

During the drill, forces practiced aerial battle as well as surface-to-air battle scenarios, advanced surface-to-air missiles combat outlines in enemy territory, and more.

The exercise focused on “broadening and enhancing the operational capabilities of the participating forces,” with a focus on air-to-air and air-to-ground attacks, as well as evading ground-based air defense systems “and various operational scenarios in enemy territory,” the army said at the time of the drill.

While Israel has never joined a regional military coalition, Marom Division commander Col. Aviran Lerer told The Jerusalem Post that there could be a time that Jerusalem might be part of such a partnership.

Lerer, who spoke to The Post after a two-week drill with 500 troops from NAVCENT’s 51/5th Marine Expeditionary Brigade, said that the IDF has to be ready to fight with other troops.

The drill, he said, was to strengthen ties with Israel’s main ally and the Marines who “are a significant force in the US military with whom we have a lot of shared interests. The United States always fights as a coalition, and it could be that will be part of a future coalition. We, as an army, have to do everything we can to be ready for a future conflict; we see the Americans as a strategic ally, and there could be a time when we will work and fight together.”

While Israel’s diplomats are working around the clock to influence the United States, the UK and France on the Iran talks, Defense Minister Benny Gantz said that the “best-case scenario” would be a deal that not only focuses on uranium enrichment but also on Tehran’s ballistic missile program and its regional hostility.

“Concerning Iran, we must influence our partners and have ongoing discussion with them,” Gantz said. “Our other obligation is to build a military force, which is an important issue by itself. I ordered the military to improve its force build-up, in parallel to our discussions with our strategic partners.”

What next for Iranian President Hassan Rouhani?

Incumbent President Hassan Rouhani, who sought re-election, won a landslide victory. He got 23.549 million votes out of a total of more than 41 million votes and his arch-rival Ebrahim Raisi got 15.786 million votes.

Iranians seeking greater freedoms have voted for President Hassan Rouhani, to secure second term. However, he is likely to face resistance by the hardliner.

There is perception that Rouhani will face more pressure in his second term as it is feared that the hardliners will create more problems for him.

Rouhani has decisively defeated Khamenei's protégé, hard-line judge Ebrahim Raisi, but the supreme leader still makes the ultimate decisions on policy, and his conservative faction still controls the judiciary and security forces.

They (hardliners) may re-assert their dominance at home by more confrontation abroad, by extending Iran's interventions in Iraq, Syria and elsewhere in the Middle East. They also fear more confrontational policy with the U.S. and Saudi Arabia.

However, certain quarters believe that since economy is the top priority of Supreme Leader Ali Khamenei, Rouhani's liberal economic policies are likely to get his endorsement, like the cautious support he got for the nuclear deal.

Rouhani, landslide victory in 2013 was on a promise to reduce Iran's diplomatic isolation, spent most of his time on the nuclear agreement with six powers that resulted in a lifting of most sanctions in return for curbs on Tehran's nuclear program.

Rouhani will have to find an accommodation with them, or end up like his reformist predecessor Mohammad Khatami, who whetted Iranians' appetite for change but failed to deliver it during two terms from 1997-2005.

The silver lining is that Rouhani has built his reputation as an establishment figure who could deliver some of the aims sought by reformists without alienating conservatives.

The added advantage is, Rouhani is a regime insider. He is loyal to the establishment. He is not a reformist but a bridge between hardliners and reformists.