Breakthrough in Nuke talks – Iran’s chance to enter world energy market

/Trend/

By Aygun Badalova

Iran, with its huge gas resources and export potential, which so far could not have been fully realized on the international energy market due to its nuclear ambitions, might get a good chance to change the situation.

Iranian president Hassan Rouhani is confident that a win-win agreement in nuclear talks will be reached between the sides.

"There is no doubt in Iran's right to enrich uranium. The whole world has accepted the fact. But we just have disagreements on details," said Rouhani.

Negotiations between Iran and the five permanent UN Security Council members plus Germany over the Iranian nuclear program are being held today in Vienna, and will last until Oct. 16. On October 15, U.S. Secretary of State John Kerry is also expected to attend the negotiations.

The success in nuclear talks would be beneficial not only for Iran, but for the whole world as well, as it could open new perspectives and new period for the world energy market.

Iran has a potential not only to become a major energy player but also to serve as a solid diversification solution to Europe. Iranian gas export potential would be more than sufficient to meet European needs in the long term perspective. And Europe understands it.

"Iran's gas could reach Europe quite easily and politically there is a clear rapprochement between Tehran and the West," a European Commission source involved in developing EU energy strategy recently told Reuters.

Iran is the second-largest proved natural gas reserve holder in the world. Iran holds 18.2% of the world's proved natural gas reserves and more than one-third of OPEC's reserves. The country's proved gas reserves amounted to 33.8 trillion cubic meters by early 2014, according to BP.

Iran produced 166.6 billion cubic meters of gas in 2013 (growth of 4.9 percent) while the consumption in the country amounted to 162.2 billion cubic meters. At the same time Iran imported 4.7 billion cubic meters of gas from Turkmenistan last year.

According to Hassan Torbati, an official with the National Iranian Gas Company, the country exported 9 billion cubic meters of gas in the previous year (ended on March 20). The country's gas export is expected to reach 10 billion cubic meters by the end of the current Iranian calendar year (March 20, 2015).

Reportedly, once Iran's Iran's ninth cross-country pipeline comes on stream, the country's total gas export capacity will be increased by 110 million cubic meters.

European direction of gas export is also of Iran's interest. The country has repeatedly expressed its willingness and readiness to provide European markets with its gas.

Iranian Oil Minister Bijan Namdar Zanganeh even said that Iran is a country capable of exporting large volumes of gas and is always willing to provide gas to Europe.

Iran seeks to export gas to Europe is through Turkish territory, but some other routes are also being studied, according to Iranian Deputy Oil Minister Ali Majedi.

Thus, breakthrough, that might be achieved in nuclear talks, would make Iran closer to its big energy plans. At the same time Europe would get an additional alternative energy supply source to meet its diversification needs.