Iran flaring gas worth billions due to U.S. and EU sanctions
TEHRAN (Bloomberg) -- Iran will lead a club of the world’s biggest natural gas exporters as its own shipments abroad are hampered by U.S. and European Union sanctions that force the country to flare off billions of dollars worth of the fuel.
Mohammad Hossein Adeli, the country’s former deputy foreign minister, was elected secretary-general of the Gas Exporting Countries Forum, whose 13 member countries hold of 60% of the world’s reserves, the group said yesterday in a statement. Adeli, who will replace Leonid Bokhanovsky of Russia next year, vowed to turn the Persian nation into a “major player among the gas exporting countries,” he told reporters after a group meeting in Tehran.
U.S. and EU trade sanctions over Iran’s nuclear program have cut the Persian nation’s crude exports, its largest revenue source, by half since 2011 and are stifling projects to export some of its gas reserves, the world’s largest. Iran is one of three GECF members that are net importers as the group faces increased competition from LNG projects from the U.S. to Australia.
Iran flared 400 Bcf of gas in 2011, the last year for which data is available, according to the World Bank’s Global Gas Flaring Reduction Public-Private Partnership. That would meet about a quarter of demand in South Korea, the world’s biggest buyer of LNG after Japan. The gas is worth about $7.3 billion on southeast Asian spot LNG markets, according to Bloomberg calculations using World Gas Intelligence prices. Iran flare associated gas because it lacks the infrastructure to process and transport it to markets.