"It could be three, six or nine months. Iran will not decrease its own production and that regional rival Saudi Arabia is trying to drive up oil prices " Zanganeh said.
“The re-election of president Hassan Rouhani last Friday helped remove obstacles to oil contracts,” he added.
With the aim to produce quality machinery and equipment for the oil and gas industry, the National Iranian Oil Company signed an agreement with a Spanish consortium to manufacture special pipelines using corrosion resistant alloys (CRAs).
The contract, estimated at around $550 million, was signed between the NIOC, Spain-based industrial group Tubacex and Iran's Sepahan Steel Company to provide Pars Oil and Gas Company (POGC) with 600 kilometers of CRA pipelines in three years.
The deal would be the most significant measure toward self-sufficiency in production of oil and gas equipment at home after the state-owned Oil Turbo Compressor Company was established in 2001 to manufacture gas compressors and turbines.
As per the terms of the agreement, Tubacex, in collaboration with Japan's JFE, will transfer the knowhow to produce corrosion resistance alloys used in manufacturing oil and gas pipelines to its Iranian business partner, Sepahan Steel Co.
Reportedly, producing such pipelines requires cutting-edge technology and only a handful of companies in the world, including JFE -- Japan's second-biggest steelmaker -- have the knowhow.
CRA pipelines are among widely-used equipment in the petroleum sector that cannot be produced by domestic companies yet. CRAs can be characterized by their resistance to specific environments. If carefully selected, these pipes permit safe containment of oil and gas process fluids. Their durability ensures improved efficiency and long life.
According to Zanganeh, domestic companies have the potential to manufacture 85% of equipment needed by oil and gas industry.
"Nearly two-thirds of demand for oil and gas equipment is now met by domestic manufacturers," Zanganeh said in a statement.