$2b Investment for Changouleh Field Development

Changouleh is one of the important oil fields in West Karoun region in southwestern Iran. Foreign companies have time and again shown interest in getting involved in development of this untapped field which Iran shares with neighboring Iraq.

Changouleh is one of the important oil fields in West Karoun region in southwestern Iran. Foreign companies have time and again shown interest in getting involved in development of this untapped field which Iran shares with neighboring Iraq. Three top Russian companies and one Croatian company have already submitted their requests for the development of Changouleh oil field which was among the projects introduced during a conference in Tehran hosted in the last calendar year to unveil Iran Petroleum Contract (IPC), the new model of oil contracts.

Initial estimates show that Changouleh development needs $2.2 billion in investment. Such activities as 3D seismic tests, location of wells and infrastructural activities like cleaning and construction of access roads for the development of the field have already been done. The development of the field will start as soon as an investor has been chosen.

Studies conducted on this field indicate that 19 wells need to be drilled for recovery from Changouleh.

Development of this field has been defined in two phases. In the first phase, 15,000 b/d of oil will be recovered under early production plan, while in the second phase the output will reach 50,000 b/d.

Changouleh was first supposed to be independent, but 3D seismic tests and interpretation of seismic data showed its shared nature. The Exploration Directorate of National Iranian Oil Company (NIOC) has confirmed that Changouleh is a joint oil field.

In the first phase development of Changouleh, which is expected to last 40 months, four new wells would be drilled while two exploration wells will be repaired. Furthermore, a 100-km oil pipeline as well as oil and gas separation facilities would be established.

Under the second phase that would last 60 months, 13 new wells will be drilled while infrastructural facilities along with pipelines are envisaged to be provided. That would raise production from Changouleh to 40,000 or 50,000 b/d.

The section of Changouleh lying in Iraqi territory is known as Badra. Changouleh is located near Azar oil field in the Anaran oil block.

Being located 20 kilometers southeast of the city of Mehran in Ilam province, Anaran oil block was discovered in 2005 by Norway’s Statoil and Russia’s LUKOIL. The block is estimated to hold recoverable reserves of 400 to 650 million barrels of crude oil.

Changouleh oil field lies along Iran-Iraq border. Bangestan formation in Changouleh field is the second most important field in the Ilam region.

Changouleh is estimated to hold 4.3 billion barrels of oil in place with API at 22. Regarding the construction activities of this project, two new wells are to be repaired while two existing wells are to be repaired for early production from the field. On the ground, a separator, transfer pumps, diesel-fueled generator supplied electricity, evaporation pool, flare, stream pipes and wellhead installations are envisaged.

In order to transfer oil that would be supplied under early production, a 130-kilometer pipeline, measuring eight inches in diameter, is being used for delivery to Dehloran.

According to a report by the Petroleum Engineering and Development Company (PEDEC), with the implementation of the early production development of Changouleh field and assessment of the field’s hydrocarbon potential, it would be possible to implement the major development plan for this field with the objective of recovering 65,000 b/d of crude oil.

According to official data provided by the Ministry of Petroleum, Iran has more than 102 oil fields, 28 of which are shared with neighboring countries. Onshore joint fields are shared with Iraq, and offshore ones are shared with the littoral states of the Persian Gulf and the Sea of Oman.

But the problem with these joint fields is that development operations in neighboring countries are over, while development projects in Iran are still going on. Our rivals will not wait for Iran to finish its work for their operation of the shared fields. The volume of these shared reservoirs declines every day without Iran having extracted oil.

In this regard, the administration of President Hassan Rouhani has focused its plans on the development of joint fields whose life cycle is limited in a bid to raise the country’s 7% share of production from these fields. Furthermore, the economic plans of Iran’s administration have created another requirement for the oil sector, which is bringing the country’s crude oil production capacity to more than 5.7 million barrels in four years.

Therefore, it could be argued that the development plans worked out for Iran’s petroleum industry with focus on joint fields have sketched out a very difficult mission for the petroleum industry. With regard to the acceleration of development of joint fields, Iran’s petroleum minister recently ordered the transfer of drilling equipment from independent to joint fields. That promises the realization of the petroleum industry’s objectives.