Azernews.Az

Secretary of the Energy Commission of the Iranian Parliament Amir Abbas Soltani said the country’s oil industry needs an annual investment of $50 billion in order to remain as it is.

Soltani made the remarks in reference to the cash subsidies paid by the government each month, stating that the subsidies have crippled the oil industry, SHANA news agency reported June 21.

Iran is facing a financial resources deficit to pay cash subsidies within the framework of the subsidy reform plan.

The cash subsidies impose about $392 million deficit in the budget per month for administration, he noted.

The Iranian government spends about $1.4 billion (based on then official rate of 25,500 rials per each USD) per month on the cash subsidies for citizens.

The government is considering plans to cut wealthy from the list of people that receive the cash subsidies.

The fact that the financial resources of the energy sector are spend as the country’s running costs is a challenge of 100 years and thorough plans are needed to tackle the problem, Soltani said.

He observed that due to lack of funding to develop Iran's extraction of joint oil and gas fields, the country’s resources are being tapped by other countries such as Qatar and Saudi Arabia.

Iranian Oil Minister Bijan Namdar Zanganeh has issued a directive to contractors to speed up the development of joint oil and gas fields.

According to the directive, drilling rigs should be relocated from non-associated fields to associated fields.

Zanganeh has said that the development of joint oil and gas fields is a national task.

Iran has a number of joint fields with Qatar, Saudi Arabia, and Iraq.

---

Follow us on Twitter @AzerNewsAz