Iran to buy jack-up rigs in South Korea

Iran has reportedly been involved in talks with South Korean shipyards over a possible offshore drilling rig order.

According to the Wall Street Journal, Iranian Offshore Oil Co. (IOOC) is in discussions with Daewoo Shipbuilding & Marine Engineering to buy five or more jack-up drilling rigs.

The newspaper has cited an unnamed source who claims that the rigs would cost $205 million each. However, the person added that IOOC was also looking at other yards for the order.

This is not the first time Iran and South Korea have been linked together in the post-sanctions era. Earlier in May, Iran signed a deal with South Korean energy company Kogas, over the development of one of Iran’s ‘key gas fields in the Persian Gulf’ – the Balal. Kogas will carry out technical studies over the gas layers of the Balal field, after which it will propose a development solution to NIOC.

More rigs

Also worth noting, the news of the potential drilling rig order comes only a fortnight after it has been reported that Iran was ordering five rigs from Russia.

To remind, Reuters in May reported Russian shipyard Krasnye Barrikady secured a contract to construct five offshore drilling rigs, to be used in the Iranian section of the Persian Gulf.

Citing an unnamed official from Krasnye Barrikady, Reuters said the value of the contract is around $1 billion, with the advanced payment for the first rig expected “soon.” The first installment will be around $200 million, the official reportedly said.

Production boost

Iran is working to increase its production to the pre-sanction levels, the reason why the OPEC meeting last week ended up without the members agreeing on the Saudi-proposed output ceiling aimed at stabilizing the oil market.

Iran’s current production has been estimated to be somewhere between 3.5 and 3.8 million barrels per day.

The country’s petroleum minister Bijan Zangeneh in April said that Iran was aiming to raise its crude oil production to 4 million barrels a day by March 2017.

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