Jan 25, 2023 06:33 UTC
  • Iran awards $500mln worth of contracts to revive low-production oil wells

Iran’s state oil company the NIOC has awarded some $500 million worth of contracts to domestic companies to revive low-production oil wells in the country.

CEO of the National Iranian Oil Company Mohsen Khojasteh Mehr said on Tuesday that around 750 low-production oil wells across Iran will be revived under the contracts signed with dozens of small Iranian companies earlier in the day.

Khojasteh Mehr said reviving the low-production oil wells will help the NIOC to boost its output by nearly 230,000 barrels per day (bpd) or around 83 million barrels per year.

He said each company will be assigned to restoration works on a maximum of five low-production oil wells as part of the contracts signed on Tuesday.

The announcement comes two months after the NIOC denied rumors that it will use the services of Russian and Chinese companies to revive low-production or inactive oil wells in Iran.

Oil Ministry figures show reviving a low-production oil well costs around $1 million, around 90% cheaper than developing a new oil well.

The project is part of NIOC’s efforts to boost its daily output and exports of crude oil despite US sanctions that have targeted both Iran’s oil sales and its investment in development of new oilfields.