Shell has submitted the results of its feasibility studies on South Azadegan and Yadavaran fields to the National Iranian Oil Company (NIOC), the Iranian Oil Ministry announced.
Both Azadegan and Yadavaran oilfields lie across the Iraqi border in Iran's strategic West Karoun oil cluster.
Shell signed a basic agreement with NIOC in December 2016 to study the investment potentials in South Azadegan and Yadavaran as well as Kish gas field.
South Azadegan, discovered in 2001, has recoverable reserves of about 2 billion barrels. It is believed to be connected with Iraq’s Majnoon field from which Shell has decided to withdraw.
The decision announced by Shell on Wednesday came after long-running talks on a planned output expansion from current levels of 220,000 barrels per day appeared to founder.
The Anglo-Dutch firm said it had agreed with Iraq’s oil ministry to relinquish operations at Majnoon field to the government after unfavorable changes to fiscal terms.
Shell is also selling its 20 percent stake in West Qurna 1 oil field in southern Iraq which is operated by Exxon Mobil.
Yadavaran – which was once described as the crown jewel of Iran’s oil projects – has recoverable reserves of 3 billion barrels.
South Azadegan and Yadavaran are located in Iran’s southwestern oil-rich province of Khouzestan and already have an early production of 40,000 bpd and 85,000 bpd, respectively. Both are expected to boost Iran’s oil production capacity by above 600,000 bpd significantly once fully developed within the next three years.
