IranDaily
Number 3249 - Mon, Oct 20, 2008 - Mehr 29 1387- Shavval 20 1429

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Published by Iran Cultural And Press Institute

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Amir Ali Abolfath

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OPEC Facing Output Challenge
Iran’s representative to the Organization of Petroleum Exporting Countries (OPEC), Mohammad Ali Khatibi Sunday said that most probably the issue of reducing oil output by one to three million barrels per day will be debated in the organization’s emergency meeting slated for next week.
“The emergency meeting was expected to be held in November. However, due to the (volatile) conditions of the oil market and the unprecedented decline in prices, OPEC members decided to move forward the meeting to check the sliding prices,“ Mehr News Agency quoted him as saying.
He noted that OPEC should not waste time if it wants to influence the oil market.
“It is more appropriate that OPEC check the fluctuations and disorder in the market as soon as possible,“ he noted.
Regarding the stance of member states toward cutting output, he said, “Holding the emergency meeting shows that all members of the organization are in agreement to reduce production and stabilize the market.“
According to Khatibi “Qatar’s oil minister believes that in order to create a balance, OPEC should lower production by at least one million bpd. This is while the Algerian oil minister declared that global demand for oil has reduced by three million barrels a day. Iran’s oil minister will declare the country’s stance, but I must say that Iran too wants lower production and more stability in the oil market.“

Restoring Stability
Elsewhere Khataibi said, “Fluctuations in the oil market is a very serious issue. Producers have the right to restore stability to the market. This will benefit producers, consumers and investors.“
He added, “Consumers should now say why they insisted on managing the OPEC oil market and block price increases, but now that the prices are falling they do not want producers to manage the market.“

Consumers Suffer
“In case the downward spiral continues, consumers will suffer the most because in such conditions no on will be willing to make investments“ in the key energy sector.
“Perhaps a few countries want instability in the oil market, but most countries desire stability. The meeting on Friday will remove all ambiguities,“ he concluded.

SP Phases 6, 7, 8 On Stream
122775.jpg
Sanctions imposed by the West have only offered new opportunities for Iran, encouraging self-sufficiency in all spheres, especially energy.
Photo by ali Hassanpour
By Ghanbar Naderi
President Mahmoud Ahmadinejad is expected to launch South Pars gas field’s phases 6, 7 and 8 in Assaluyeh, Bushehr province today, October 20.
Ministers of oil and industries and mines as well as several other high ranking officials will attend the opening ceremony.
The mechanical components of the gas-fire refinery for South Pars phases 6, 7 and 8 have been installed and now the refinery is ready to come on stream.
Phases 6, 7 and 8 refinery is projected to produce 172,000 barrels of gas condensates, 4390 tons of liquid propane and butane, and 370 million cubic meters of ethane gas daily to be fed to the Assaluyeh petrochemical units. The extra 3.64 billion cubic meters of gas will be injected into Aghajari oil region’s wells.
South Pars phases 9 and 10 will similarly come on stream in the near future. The 5 phases will add close to 50 million cubic meters to the country’s gas production capacity.
The total production of the three phases (except for sour gas and ethane gas) is estimated to be worth $15 million a day. IDRO, Japan’s Toyo Engineering Corporation, Japan Gasoline Company and South Korea’s Daelim Company have jointly implemented the project in 5 years at a cost of $2.05 billion.
In an attempt to control growing domestic gas demand and decrease subsidies for high-volume end-users, Iran raised domestic prices substantially, especially for residential and commercial use, using a pricing mechanism based on consumption that can elevate the price to nearly eight times the former base price of 39¢/MMbtu. However, this mechanism has been unsuccessful in reducing demand. The country is expected to experience strong gas demand growth of 8 percent during 2008-20.
Accelerating demand is beyond National Iranian Oil Company’s (NIOC) control because of a disconnect between downstream and upstream activities. National Iranian Gas Company (NIGC), which controls downstream development, is separate from NIOC and has different planning views. The development of the downstream section has always been faster than upstream, and gas shortages may not be surprising, especially in peak winter demand.
Development of Phases 9 and 10, which would release 2 bscfd of gas to the domestic market, is nearing completion and gas is expected to flow from Phase 9 soon.
Phase 12, which will produce 3 bscfd of gas and 110,000 b/d of condensate, will not be completed until late 2012. About 1 bscfd of gas from Phase 12 has been allocated for domestic market.
However, another 2 bscfd of gas from Phase 12, which has been designated as feedstock for Iran’s LNG plant, might well be delivered to the domestic market until the long-delayed LNG project starts up in 2015.
NIOC and National Iranian Drilling Company recently signed a contract valued at more than $1 billion for drilling 27 wells in Phases 17 and 18, which are intended to produce 2 bscfd of gas and 80,000 b/d of condensate. They are expected to be completed in 2014.
In sum, the illegal sanctions imposed by the West have only offered new opportunities for the country, encouraging self-sufficiency in all spheres, especially energy. Seeing the three phases go on stream today in the giant South Pars gas field, Western experts say the US-led sanctions have indeed failed to bite and that future sanctions are likely to remain ineffective.
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Perspec
No Soft Corner
By A. Khalili
For several days Iraq has been a scene of large demonstrations and opposition of the people and the government toward the contemptuous remarks by Lieutenant General Raymond Odierno, who took command of the US forces last month.
In a recent interview with The Washington Post the general claimed Tehran is trying to cajole Iraqi lawmakers to oppose the US-Iraq security accord known as the Status of Forces Agreement (SOFA). He also charged that Iran was “paying off people“, politicians and policymakers to kill the deal strongly opposed by Iraqis across the political and religious spectrum.
The shocking charges by the American general drew extensive reaction from the people, political groups, senior officials and legislators.
Prime Minister Nuri Al-Maliki characterized the comment as unfortunate, and said such lethal pronouncements would only further complicate Washington-Baghdad relations.
Moreover, Iraq’s government spokesman, Ali Al-Dabbagh in a statement protested the claim and said the general had resorted to unacceptable language toward the elected representatives of the Iraqi people.
Regarding the aim and objectives of Odierno’s outburst, it should be recalled that the Americans first tried to bypass the parliament and religious authorities to push the security agreement. However, they encountered strong reaction from political groups, religious figures and the Iraqi street. Grand Ayatollah Ali Sistani in a recent meeting with Maliki, made it known that any deal with the US must be approved by parliament.
As the going got tough, and in a final bid to pressure the parliament to accept SOFA, the Americans visibly panicked and started raising irresponsible claims about “pay offs“ from Iran to the elected representatives of the Iraqi people.
The claim was indeed a big insult to the intelligence of Iraqi people and their parliamentarians. The American fury is rooted in the fact that its troops should leave Iraq by Dec. 31 based on a deadline set by the UN Security Council (UNSC).
America is desperately seeking to impose the security agreement so that it could, among other things, prolong its unwanted and unhelpful military presence in Iraq and overrule the UN deadline.
Bush’s America is trying to extend the occupation of Iraq and protect its trigger-happy soldiers by pushing for their judicial immunity as outlined in the proposed accord. In case parliament opposes the deal, US troops will not be allowed to step out of their barracks and should pack their bags sooner rather than later.
Experience has it that whenever Washington faces serious problems in implementing its “plans“ in Iraq, it rushes to its old and outdated policies of blaming others, in particular Iran, for interfering in Iraq’s internal affairs. Presently, America is doing all it can to harm the growing relations between Tehran and Baghdad and sow seeds of discord among Iraqi legislators.
The outcome of such recklessness will be nothing but more tension and insecurity. In order to reach the said goals, the US Defense Department recently paid 300 million dollars to private contractors in Iraq to convince sections of the media to provoke Iraqi public opinion against Iran.
The outrageous remarks by Odierno are yet another indication that the lame duck Bush and his aides have long run out of ideas and options in the Iraqi desert.
If and when they accept the ground realities, they will realize once and for all that six years and a full-fledged bloody conflict later they have no soft corner among the oppressed Iraqis despite getting rid of the cruel Baath Party dictator and his tyrannical regime.