Abu Dhabi: The Iranian energy projects market represents a $167 billion (Dh613 billion) opportunity for regional and international companies as the Islamic republic prepares for the lifting of sanctions.

According to the latest data from Dubai based MEED Projects, an online projects tracking service, there are 197 individual energy (oil, gas, petrochemical, industry and utilities) projects either planned or under way in Iran, a number that could well double as sanctions are gradually lifted.

The largest single future project in the Iranian energy sector is the estimated $4.5 billion Kish Gas Development, followed by the $3.2 billion Anahita oil refinery in Western Iran. Another major future projects include the $3 billion Nalco aluminium complex and the $2.5 billion Jask oil terminal project.

Due to the embargo, much of Iran’s energy infrastructure requires upgrading and modernisation, particularly with technology that was previously unavailable.

Based on the MEED Projects installed asset database there are more than 200 individual facilities commissioned over the past 15 years in the country with an asset value in excess of $100 billion, and a further 250 projects built before 2000 that require substantial brownfield investment.

Gas and oil reserves

“With a GDP of some $400 billion, a population of close to 80 million, and the world’s third largest gas and fourth largest oil reserves, Iran has long represented an excellent projects opportunity,” says Ed James, Director of Content & Analysis at MEED Projects.

“However, it is only now with the impending lifting of sanctions that international companies — for the first time in a decade — have the opportunity to invest in the local projects market.”

MEED said with the exception of 2010, the value of energy contracts has declined from a peak of $21.1 billion in 2005 to just $6.9 billion last year.

Meanwhile, Iran can boost oil production in one week after international sanctions are lifted, and Opec’s refusal to accommodate Iran in export markets would result in lower crude prices, Bloomberg reported quoting the Oil Minister Bijan Namdar Zanganeh.

Production can increase by 500,000 barrels a day in a week after sanctions end and by 1 million barrels a day in one month, state-run Islamic Republic News Agency reported, citing Zanganeh in an interview with state TV.

Sanctions against Iran’s oil industry should be lifted by late November, he said, according to Iran oil ministry’s Shana news agency.

Oil producers such as BP Plc and Royal Dutch Shell Plc have expressed interest in developing Iran’s reserves, the world’s fourth-biggest, once sanctions are removed. Iran is organising a conference in London in December to discuss new oil contract models with international companies.

“Our lost share of the market, which was about 1 million barrels a day, will manifest itself,” Zanganeh said, according to IRNA.

Under the nuclear agreement Iran and six world powers reached in Vienna last month, the US agreed to end efforts to limit Iran’s oil sales.