Iran's Gas Industry Celebrates 50th Anniversary

Iran's gas industry marked its 50th anniversary on July 11 of this year, with natural gas currently accounting for about 70% of Iran's energy consumption. Daily gas consumption in Iran was around 7 million cubic meters in 1976, peaked at 70 million cubic meters in 1992, and now stands at 700 million cubic meters daily. In other words, over the past 40 years, Iran's gas consumption has increased 100-fold. At the beginning of the Islamic Revolution, gas accounted for about 10% of Iran's energy consumption. Currently, gas, as a cleaner fuel than oil and coal, has a 24% share in global energy consumption, while its share in carbon dioxide production is only 20%. The global shares of coal and oil in air pollution are 46% and about 34%, respectively. Last year, approximately 3.6 trillion cubic meters of raw gas were produced globally, with one trillion cubic meters exported by producers. Iran, as the largest holder of gas reserves in the world, accounted for just over 7% of global gas production, yet it remains a net gas importer. In the 108 years since the establishment of its oil industry, Iran has only been recognized as a natural gas producer and exporter in the second half of that period, despite producing large amounts of associated gas from its oil fields, which were flared due to a lack of technology for collection and containment. In the 1960s, Iran finally began gas production projects, constructing an 1100-kilometer gas pipeline from south to north with the help of the Soviet Union, and began annual exports of 10 billion cubic meters of gas to the Soviet Union from the early 1970s for seven years. With the onset of the revolution, these exports were not only halted, but Iran's plans with the Soviet Union for gas transfer to Europe were also stopped. At that time, it was planned that Iranian gas would be transferred to Europe for 20 years through Soviet territory. Now, Iran has again set a goal for production growth and capturing a share in global gas markets. According to official statistics, Iran's need for the development of oil and gas fields, along with refineries, petrochemicals, and pipelines over the next 10 years is a total of $501 billion, of which $310 billion should be invested in the gas sector. Azizollah Ramazani, the director of international affairs at the National Iranian Gas Company, recently announced that by the sixth development plan (by 2021), 68 to 80 billion cubic meters of the country's gas production will be allocated to exports. He stated that 50 billion cubic meters should be exported to neighboring countries, and there will be an additional capacity of 30 billion cubic meters of gas for export to Europe. By this year, Iran aims to increase its gas production to 385 billion cubic meters annually, which seems achievable given the pace of development projects in Iran, especially the South Pars field. For the next 10 years, Iran also aims to increase its gas production to 475 billion cubic meters annually, which will depend on the country's success in attracting international investments. Currently, the country produces about 255 billion cubic meters of gas. The importance of Iran's gas production and export, aside from being cleaner compared to oil and coal, lies in the fact that Iran, with 34 trillion cubic meters, is the largest holder of gas reserves in the world, and global gas consumption is expected to grow rapidly to 5 trillion and 750 billion cubic meters annually by 2040, which is 60% more than current global needs.