Transcript IRAN - MEANS OF TRANSPORTATION

Caspian Energy - Quo Vadis ?
- The Role of Iran –
Franz B. Ehrhardt,
President & Managing Director, Conoco EurAsia Inc.
Issues
• Caspian Commercial Scenario
• Caspian Political Scenario (short, medium, long
term)
• Iran - A Regional Economic Benchmark?
– Crude
– Natural Gas
• Implications, Conclusions, Path Forward
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
2
Caspian Commercial Scenario
• High Export Cost - Landlocked, Difficult Terrain,
Political Complications, Long Distance to Market
• Downward Revision of Reserves ?!
• Less Crude, More Gas ?!
• Surrounded by Low Cost Oil & Gas
• Low Oil & Gas Price Impact - Delays?
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
3
Caspian Political Scenario
(short, medium, long term)
• Many Competing Political Agendas - Power Play
• Unresolved Caspian Sea Border Dispute
• Considerable Political Uncertainty, Instability, And Unrest
• Ineffective But Complicating Unilateral Sanctions by the
USA
• Prevailing Politics Do Not Permit Most Viable Economic
Solutions
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
4
Iran - A Regional
Economic Benchmark?
• Swap of Caspian Crude Cost Effective and Immediate
• Congruency of Caspian Countries
• Iran Implements Related Infrastructure Development
• Turkmen Gas Trade Under Way, More Expected
• Single Country Transit
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
5
IRAN - MEANS OF
OIL TRANSPORTATION
ROAD 25%
RAIL 8%
PIPELINES 67%
TOTAL PIPELINE SYSTEM: 13,000 KM
July 20, 2015
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6
CASPIAN (IRAN)
TANKER ISSUES
1. Preliminary plans for commissioning tankers in the
Caspian Sea with participation of shipbuilders and oil
majors.
2. Options for Tankers from OCTOVO, TURKEMENBASHI,
and BAKU to NEKA
3. Loading and lifting capacities for crude at the Persian
Gulf Terminals.
4. Concerns for environmental protection in the Caspian
Sea.
July 20, 2015
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Conclusions, Implications
• Iran Offers Economics That Have to Be Met by Competing
Export Routes
• Iran Will Extract What the Market Will Bear
• Multiple Export Routes are Essential for Diversity and
Economic Balance
• The First Route, Usually, Will Be the Most Economic
• How Much Crude, Actually, is There to Export?
• Can the Prevailing Low Crude Prices Support Major Pipeline
Projects?
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
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Path Forward
• Time To Be Pragmatic And Jointly Support The Long Term
Competitiveness Of Caspian Energy
• Encourage Broad Industry and Regional Government Cooperation
To Develop The Lowest Cost Export Infrastructures
• Prudently Balance Between 25 - 30 Year Projects And Fluctuating
Political Climates and Trends
• Create Reasonable Flexibility To Ensure Security Of Sustained
Economic Supply
• Drop Unilateral Sanction And Initiate Accelerated Stepped
Engagement With Iran
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
9
TURKMENISTAN NATURAL GAS
CONSUMPTION and EXPORT
TOTAL PRODUCTION
90
80
70
Bcm
60
50
Export (BCM)
Consumption (BCM)
40
30
20
10
0
1995
1998
2000
2005
2010
2015
2020
Years
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
10
PAKISTAN NATURAL
GAS SUPPLY - DEMAND (BCF)
DEMAND
5000
4500
4000
3500
Bcf
3000
SHORTFALL
TOTAL SUPPLY
2500
2000
1500
1000
500
0
1999
2000
2005
2010
2015
2020
Years
July 20, 2015
Copyright© 2005CASCA Consulting, L.L.C. All rights reserved
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