Rise in oil production

"Oil production capacity will increase to 7.5 million barrels per day."
Marvi, Vice President of Energy Commission and Member of the parliament from Neishaboor, announced the rise in oil production by 2018 and added that the petrochemical production will increase from $ 25billion to $80 billion by year 2021 which is accompanied by the Thermal Power Plants efficiency to boost from 36% to 57%.
In a press conference, Mr. Marvi updated the journalists by informing, "According to the account given by the oil and petroleum ministry to the Energy Commission, oil generation capacity will increase by boosting the crude oil output from more than 26 shared oil fields. 700,000 bpd output from Yadavaran, Yaran and Naftshahr, as well as an additional 1 million square meter increase in condensate production are included in the ministry's development plan. Based on this plan, construction of 8 refineries for natural gas plants in Asalooye is being studied. Natural gas extraction will hit 1billion bpd by 2018, of which 30% will be exported. Meanwhile, export of Petrochemical products will increase from $25 billion to $80 billion by 2021".
He went on to say, "In order to increase the production and export of petroleum products and reduction in crude oil exports, refining capacity will rise from 1.3 to 2 million barrels and 1 million square meter increase in condensate production will be materialized".
Marvi stated that investment in refinery projects abroad will result in dependency of foreign countries on Iran oil and hence, it helps to render the sanctions ineffective.
Referring to ministry's policies to utilise the capacity of private section in oil and petroleum industry, he said: "The Energy committee and oil ministry are aware of the private section potentials especially in the period of sanctions. Based on the private section enquiries to invest in Iran-Pakistan gas pipeline project, which is suspended right now, and their proposal to purchase the oil from the ministry, export and return its money to country with the necessary guarantees, the enquiries are being studied in the ministry's survey centre.
Discussion about the private investments in oil and petroleum reservoirs is also happening. Marvi noted the required resources for investment in oil industry development come from the oil revenues, of which 14.5% is directed toward the same industry.
He announced the ministry's plan for development and privatisation of petrochemical downstream industries and stressed the ministry's plans to support and entrust the private sectors with highly lucrative and efficient petrochemical downstream industries and affiliated projects under terms and conditions.
Answering the questions about Babak Zanjani's case and likelihood of such violations to repeat, Vice President said: "Zanjani's breach occurred under especial circumstances. In that period, the country's produced oil was on the tankers offshore and nothing could be done about it. He had given assurance to the officials of the time in the ministry and they trusted him. However, at the present time, the ministry emphasises on the mandate to obtain bank guarantees in case the private sector is willing to cooperate".
Referring to the government decision for price adjustment in the 2nd phase of Subsidy Reform plan, he said: "The psychological effects of the hike in petrol price on the market cannot be controlled. The government must adopt policies to control the situation and the impacts of increasing the petrol price so as to restrain the inflation rate".
Underlining the government policies to reduce the budget dependency on oil revenues, he said; "Studies conducted by research centres show that during one century after oil discovery in Iran, we had only two years of financing the budget without reliance on oil revenues. Lucas, one of the most prominent economists in the world, believes that unless Iran's budget cuts its heavy reliance on oil revenues, the inflation will remain in force and, unfortunately, this is what we have not been able to realize so far".
"The plan to segregate the budget from oil revenues to attain an independent budget is being discussed seriously and includes allocating 14.5% of oil production to the industry, 2% of oil revenues to underprivileged areas and 29% to the national development fund. Provided that we can cut the budget's dependency on oil, we will be able to develop economy of resilience", he maintained.
Marvi stated; "We are not accustomed to energy conservation methods due to the low prices of energy carriers such as water, electricity and oil in the past. Adjustments in the subsidy reform plan will enable us to move toward utilisation of energy conservation.