Iran, Russia in talks over reverse oil swap

IRAN: A senior Iranian energy official says the Islamic Republic and Russia are engaged in serious negotiations to launch a south-north reverse oil swap project.

National Iranian Oil Company (NIOC) Managing Director Rokneddin Javadi said on Sunday that negotiations are underway between the two sides, but the time for the start of the swap operation has not been finalized yet.

On October 31, 2013, Javadi said the revival of swap deals will increase the operational power of Iran’s oil industry and boost the efficiency of the Islamic Republic’s energy diplomacy.

“In order to prepare the necessary infrastructure to revive this operation, numerous meetings have been held with Oil Minister [Bijan Namdar Zanganeh] and positive results have been achieved,” he stated.

Iran plans to develop the coastal infrastructure at its northern port city of Neka, situated some 200 kilometres (124 miles) north of Tehran, and raise its oil swap capacity.

Iran imports oil from Central Asian countries to be refined at Tehran and Tabriz oil refineries and then delivers an equivalent amount of oil to potential buyers in the Persian Gulf.

Iran started its oil swap with the Caspian Sea and Central Asian states in 1997. Naftiran Intertrade Company (NICO), a subsidiary of the NIOC, is administering Iran oil swap operations.

Besides revenues and regional diplomacy, the oil swap project reportedly saves Iran the costs of carrying 500,000 barrels per day of oil from south to north of the country.

Analysts say Iran represents the best route for energy transfer in the region as this route is shorter and less costly than those of Russia and Turkey.

- PRESS TV