Azerbaijan-Iran oil swap deal to come into force soon
By Aynur Karimova
Azerbaijan's state energy giant SOCAR's signing two memorandums of understanding with National Iranian Oil Company and Ghadir Investment Company as part of President Ilham Aliyev's Tehran visit on February 23 promise new opportunities and prospects for cooperation of the two countries in the energy sector.
Iranian Deputy Oil Minister Rokneddin Javadi believes that the oil swap deal signed between the NIOC and SOCAR will enter into force soon.
“Iran is about to resume oil swap with Azerbaijan after a gap of five years, importing crude into Caspian ports and supplying equivalent barrels on behalf of its Azerbaijani partners in the Persian Gulf. The two sides will also cooperate in the Caspian Sea, particularly in the spheres of research and development,” Fars News Agency quoted Javadi as saying last week.
In August 2015, Iran’s Oil Minister Bijan Namdar Zanganeh expressed Iran's readiness to carry out swap deliveries of Azerbaijan’s oil to the Gulf region.
He said oil could be transported from Iran’s Neka port on the Caspian Sea via pipeline with a capacity of pumping 500,000 barrels per day to the Tehran Oil Refinery, noting in return, Azerbaijan could deliver oil to the southern borders of Iran.
Iran plans to resume swap of oil products, primarily natural gas liquids, with Turkmenistan and Kazakhstan as well.
The port of Neka located in northern Iran has an import capacity for crude swaps with the Caspian states of Turkmenistan, Kazakhstan, Azerbaijan and Russia.
The Caspian oil swap started in 1997 and was in place for more
than 12 years.
Under the arrangement, Iran received crude from Azerbaijan,
Kazakhstan and Turkmenistan in the Neka port for processing in its
northern refineries and delivered an equivalent volume to the
clients of those countries in the Persian Gulf.
The average daily swap was 90,000 barrels in 2009, which Iran planned to raise to 300,000 barrels per day by 2015. Iran also charged the partners with a transit fee which totaled $880 million between 1997 and 2009.
--
Aynur Karimova is AzerNews’ staff journalist, follow her on Twitter: @Aynur_Karimova
Follow us on Twitter @AzerNewsAz