February 2, 2007 / 1:43 PM / 12 years ago

UPDATE 1-Lukoil hopes for April Iran Azar oilfield deal

(Adds NIOC head output estimates, comments on Azadegan)

VIENNA, Feb 2 (Reuters) - Russia’s Lukoil (LKOH.MM) hopes to sign a development deal for Iran’s Azar oilfield in April and is working on a preliminary development plan for the giant Azadegan field, a Lukoil senior executive said on Friday.

“We are very hopeful that this (Azar deal) can be signed in April,” Viatcheslav Kosmynin, Lukoil’s director in Iran, told Reuters on the sidelines of an energy conference in Vienna.

“We have submitted the development plan to Iran with our partners Norsk Hydro and are negotiating terms.”

The Azar field could produce up to 55,000 barrels per day (bpd), Gholamhossein Nozari, Managing Director of the National Iranian Oil Company, told Reuters on Friday.

He said that he hoped to sign the deal with Norsk Hydro (NHY.OL) and Lukoil in “a few months.”

Kosmynin also said that Lukoil is continuing talks with Iran to take a role in developing the Azadegan field. Lukoil is preparing a study of the field for NIOC and is also drawing up a preliminary development plan.

“I really hope that contract will be ours,” he said. He did not detail what stake in the field Lukoil might take or when a deal might be signed.

Iran’s foreign minister said in December Lukoil would get a stake in the field.

Japan’s INPEX lost the right to take the lead role in a $2-billion development of the oilfield in October, citing delays in clearing landmines from the area and spiralling investment costs.

Analysts said political concerns could have played a part as the U.S. increases pressure on Iran over its nuclear work. The U.N. imposed limited sanctions on Iran in December for failing to stop nuclear enrichment.

Since the INPEX talks collapsed, Iran has awarded a contract for the Azadegan development to a domestic firm, but analysts say the formation is complex and Tehran will need foreign expertise to extract the oil. At its peak, the field is expected to pump about 260,000 barrels per day of oil.

Kosmynin also said that Lukoil was undertaking a joint study with Iran of oil and gas fields in its Moghan and Laleh exploration blocks.

Norway’s Norsk Hydro and Lukoil worked together on an exploration contract for the Azar field and discovered oil there in 2005. The companies later said the field holds 2 billion barrels of oil.

Norway’s Norsk Hydro held 75 percent of the exploration license, while Lukoil held 25 percent.

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