Why hasn’t the South Pars project to increase pressure been implemented yet?

According to Energy Press reports, the South Pars gas field enhancement project, with signed multi-billion dollar contracts, has not progressed beyond the stage of paperwork and studies.

South Pars, the world’s largest gas field, supplies more than 70% of’s gas consumption and plays a decisive in the country’s energy security. However, the natural decline in reservoir pressure to three decades of extraction has created serious threat to sustainable gas production and country’s energy economy.

, implementing enhancement plans, which involve equipping the field with powerful compressors to maintain and prevent production decline, is considered one of the most crucial necessities of Iran oil and gas industry.

The official contract for the South Pars gas enhancement project was signed on February 0, 2023, the South Pars Gas and Oil Companyclient) and several Iranian contracting companies with an estimated investment of around $7 billion. On February 18, 2024, seven supplementary contracts were also signed in the presence the CEO of the National Oil Company the Oil Minister to launch the project its implementation phase.

In April 2024, reports also emerged of a major $17 billion aimed at equipping the joint field. However, what is the reality? Over a year after the contracts signed, no tangible operational progress has observed, and the project remains in state of delay. According to recent, apart from a few study sessions administrative summaries, the actual operational implementation compressors, financing, and field work not yet started, which has created in the project’s progress.

An analysis of the project’s status that the delay in implementing the enhancement is a result of a combination of, managerial, and institutional obstacles; incomplete financing, despite the signed contracts the project’s financial resources have not fully allocated, and the capital financing are still pending approval by decision- bodies.

The decision-making bureaucracy remains challenging. Officials have repeatedly that contracts have been signed, but project is stuck in “the queue approval by the Economic Council” and finalization of the operational mechanism.