Iran, Russia ink $1 billion oil rig deal

The deal signed with Iran’s Tasdid Offshore Development Company (TODC) on Sunday envisages the construction of each drilling rig over two years in the port city of Khorramshahr, TODC Managing Director Ehsanollah Mousavi said.

The project will be jointly financed by Russia and Iran, and put the Islamic Republic among the countries capable of building drilling rigs.

“According to the timetable, domestic share in the construction of the first drilling rig will be 58%. This share will gradually rise during the execution of the project with technology transfer into the country,” Mousavi said.

“The project financing will be done by the Russian company. The return of investment will come from the leasing of the rigs to the country’s oil and gas projects, with the investment and profits planned to return in five years," he said. 

Krasnye Barrikady officials have already said Iran will make a 15 percent down payment on the $200 million price of the first rig.

Mousavi signed the agreement with Krasnye Barrikady CEO Alexander Ilyichev, lending a fresh momentum to Iran’s oil and gas development, including its massive South Pars field.

Iran is developing the South Pars gas field which the country shares with Qatar in several phases, with US-led sanctions forcing the country to rely on its own capabilities to implement the megaproject.

“When South Pars started, nobody imagined Iran could enter the field of building oil equipment including platforms, installation of offshore pipelines and constructing jackets. But today, Iran has attained these capabilities.

“With the signing of this deal today, Iran’s dream of building jack-ups has also realized,” Mousavi said.