TEHRAN, Sept. 5 (Xinhua) -- The National Iranian South Oil Company (NISOC) signed two contracts to contain Associated petroleum gas (APG) from oilfields in the east Karoun region, located in Iran's southwestern Khuzestan Province, EghtesadOnline news website reported on Wednesday.
The contract signed between NISOC, a subsidiary of state-owned National Iranian Oil Company (NIOC), and two domestic companies on Tuesday is worth 1.2 billion U.S. dollars.
Based on the contracts, the two companies of Persian Gulf Petrochemical Industries Company and Marun Petrochemical Company will implement 32 plans to renovate and upgrade NISOC's installations for flare gas collection in the next two and a half years, the report said.
The venture is aimed to save 22 million cubic meters of natural gas per day.
The collected APG natural gas will be supplied to the under-construction Bidboland-2 Gas Refinery and Marun Petrochemical Company, Mohammad Mostafavi, an official with NIOC said.
In addition, NISOC's output of natural gas liquids will increase by 38,000 barrels per day, which will be delivered to Bandar Imam Petrochemical Company as feedstock, Mostafavi added.
"Thus, petrochemical plants will receive 1.6 million tons of ethane and other heavier gaseous compounds per year, which is a big leap toward alleviating the shortage of feedstock," Mostafavi said.
Natural gas liquids are components of gas separated in the form of liquids. This separation occurs in a field facility or in a gas processing plant through absorption, condensation or other method.
Mostafavi also said that another plan is underway to collect gases in Masjed Soleiman oilfields in Khuzestan Province.
APG is found in deposits of petroleum. It is often released as a waste product and burnt off as flare gas.