Iran and Japan agree on finalizing oil project

Jul 28, 2006, 15:34 GMT

Tehran - Iran and Japan have agreed to finalize an oil project in Iran's southern Azadegan oilfields, Iranian Oil Minister Kazem Vaziri Hamaneh told the Mehr news agency Friday.

'If no new problems occur, the agreement letter will be finalised by the end of the current (Persian) month (August 22),' the minister said.

Iran and Japan signed the two billion-dollar deal in October 2004. It includes developing parts of the Azadegan oil fields in the Gulf, but delayed its implementation in view of ambiguous nuclear plans.

'Japan is very interested to continue cooperation with Iran in the Azadegan project, and we will sign a new agreement,' the minister added.

Iran had charged Japan with having violated its commitments in the Azadegan oilfield under the pretext of complete de-mining of the southern field, although Iran denied any landmine-related problems in the area.

The total investment in the Azadegan buyback contract is estimated at four billion dollars. The capacity is believed to be 30 to 35 billion barrels of oil, the daily production 150,000 and 260,000 barrels within two phases.