Iran Awards Contracts to Push Ahead with Major Oil Pipeline Project

Iran has awarded contracts to three domestic engineering firms for manufacturing giant pumping devices needed for a major pipeline project that would transfer Iran's oil from export terminals southwest of the country to the coast of the Sea of Oman, in the southeast.

A report by the official IRNA agency said the three companies were supposed to deliver a total of 50 pumps and provide maintenance services for a period of five years as part of the 48-million contract signed earlier in the day in Tehran.

The giant devices will be installed at five pumping stations along the Goureh-Jask pipeline, a 1,000-kilometer project which would enable Iran to deliver oil for exports at the mouth of the Sea of Oman, rather than in the Persian Gulf, once the project is finished by 2021.

The mega project, which is estimated to cost around $1.8 billion, will transfer oil from a major plant in southwestern province of Bushehr to 20 storage facilities with a total capacity of 10 million barrels located in Jask, a small port east of the province of Hormuzgan.

The awarding of the contracts on Monday was a sign that Iran is determined to push ahead with the mega project even at the time of increased American sanctions on its oil industry.

Iran's Oil Minister Bijan Namdar Zangeneh said the giant pumping devices commissioned as part of the contract would be the largest ever made inside Iran.

"This contracts are signed in order to activate the oil industry and revive hope in the hearts," said Zangeneh, adding that increased activity in the oil industry would help other sectors to grow.

The minister said the government had a separate investment plan worth $700 million to build two refineries and other petrochemical complexes in Jask, a relatively deprived region which will host new crude exporting terminals.