NIOC National Iranian Oil : Iran All Set for Promised Crude Output Surge

ran said on Friday that it is all set to go ahead with an immediate surge in its oil production by 500,000 barrels per day as soon as the sanctions against the country are lifted.

Rokneddin Javadi, the managing director of the National Iranian Oil Company (NIOC), has said that all the related facilities in the oil industry are ready for the surge that Iran has already promised to implement. The facilities include oil production equipment at the fields, the pipelines, oil tanks, export terminals and other technical infrastructure.

'The related marketing activities with both the traditional as well as the new clients have also been carried out. There is no problem for Iran to increase its oil production by 500,000 bpd after the removal of the sanctions', Javadi added.

China will be Iran's biggest oil client in the post-sanctions era. Official figures released by China's customs department show that the country increased its imports of crude oil from Iran by 45 percent in November 2015. The figures also show that Iran exported an average of about 500,000 barrels per day of oil to the country over the same period.

Nevertheless, Iran will have to compete with Russia and Saudi Arabia in selling the new supplies of oil to China. In November, Saudi Arabia exported 887,000 bpd and Russia exported about 950,000 bpd of oil to China.

On 19 December 2015, Iran said it has set a record in boosting its crude production by 500,000 barrels within a matter of hours.

Mohsen Dehqan-Zadeh, the managing director of Karoun Oil and Gas Development Company, said that the record had been made in Iran's southern onshore oil fields.

Dehqan-Zadeh said this was part of a test to check the abilities of the country to increase its oil production as soon as the sanctions are lifted.

Iran's Oil Minister, Bijan Zanganeh said in August that the country could increase its oil output by 500,000 barrels per day (bpd) within a week after the removal of the sanctions.

Zanganeh had further said that Iran's oil output could increase by above 1 million bpd within a month after all the sanctions are lifted.

Other officials have also emphasized that Iran will proceed with increasing its oil production even now that the price of oil is plunging below $30 per barrel.

Mehdi Assadli, Iran's national representative to the Organization of Petroleum Exporting Countries (OPEC), said last week that Iran spends less than $10 for production of each barrel of crude oil. This, Assadli said, will remove any concern for Iran to increase its oil production if the prices drop even lower than $30 per barrel.