Wednesday 16 November 2016

Norway’s DNO has inked a memorandum of understanding to develop the Changuleh oilfield in Iran in its first move into the Middle East country’s newly reopened oil and gas sector.

The Oslo-listed company will carry out a study for development of the field under the preliminary pact signed with state-owned National Iranian Oil Company, DNO said in a statement.

The field in western Iran, discovered in 1999 but never developed, is estimated to hold more than 2 billion barrels of in-place resources.

DNO, which is mainly active in Iraqi Kurdistan, has now established a local subsidiary in Iran and aims to expand its presence in the country following the lifting of Western sanctions against Tehran’s nuclear policy after an agreement reached last year.

"Iran presents an obvious and exciting next step in expanding DNO's footprint in the region. Our low-cost, fast-track development strategy and our fractured carbonate reservoir experience in theKurdistan region of Iraq can be easily applied and leveraged in Iran," said managing director Bjorn Dale.

DNO is the latest foreign player to ink deals under Iran’s post-sanctions regime after a Total-led consortium last week signed a major agreement to develop the $2 billion first stage of Phase 2 of the South Pars gas field.

Iran, for its part, is looking to rebuild its dilapidated oil infrastructure that has suffered from a lack of investment,.as well as earlier war damage.