Russia looks at a potential investment of $50 billion into the oil and gas industry in Iran

Russian analysts have suggested that energy businesses could potentially spend in excess of $50 billion on oil and gas exploration activities in Iran. Yuri Ushakov, a presidential official said a range of businesses including Gazprom, Rosneft, Lukoil, Tatneft, Zarubezhneft and Gazprom Neft were making strategic plans to work and operated on developing oil and gas fields in Iran.

Iran Oil and Gas

The recent announcement comes not long after Zarubezhneft became the second business, after Total to confirm an agreement organised by Tehran to attract oil and gas businesses back into its industry. Zarubezhneft will invest over $700 million into the development of two oil sites in western Iran, with overall plans to increase oil production to over 100 million barrels within the next ten years.

In 2017, Alexander Novak, the Energy Minister suggested that the business was looking to work on several projects in Iran and to increase its investment spend in the region of $6 billion USD. Earlier this year, it confirmed a deal with local company IDRO Oil to work on a collaborative project to develop a third oil field in south-west Iran.

Late last year, Russian President Vladimir Putin visited Iran and the two nations signed six initial agreements involving a series of oil and gas project that would involve an investment in the region of $30 billion into the energy sector in Iran.

Industry experts believe Russia is a likely partner for Iran and its energy market, more so than western oil majors that are hesitant to invest in Iran due to potential economic sanctions. Despite some concerns, Total is the first western business to re-establish its connection to the oil and gas market in Iran after sanctions were recently removed. Total has confirmed an investment of $1 billion USD into the development of the South Pars gas site.

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