Iran cuts oil output by 200,000 bpd

By Chua Baizhen

BEIJING (Reuters) - Iran has cut oil production by 200,000 barrels per day (bpd) from 4.04 million bpd, in line with an OPEC agreement to find ways to support declining crude prices, a director of the state oil company said on Friday.

"We are obeying the OPEC quota. We have cut by 200,000 bpd," Mohammad Ali Emadi, director of National Iranian Oil Co (NIOC), told Reuters in Beijing, where he is attending a forum of national oil companies.

The Organization of the Petroleum Exporting Countries agreed at an emergency meeting on Oct. 24 to lower its output ceiling by 1.5 million bpd, or around 5 percent.

It had already said the month before that it would take away around 500,000 bpd pumped above its agreed target.

Asked about the excess crude from the cuts, Emadi said: "Some will be sent to storage and sometimes we use this opportunity for overhaul and maintenance."

He said Iran, the world's fourth-largest oil producer, was targeting 5.0 million bpd of oil production capacity by the end of 2010, up from capacity of 4.2 million bpd now.

"We have some major plans (to raise total output), including the upgrading of surface facilities for more water cut separation," he said. "We are also planning more gas injections and water flooding in offshore areas. On top of the brownfield projects we are also developing many greenfields."

Iran's oil and gas sector is turning to energy-hungry Asia for funds, expertise and technology to elude U.S. sanctions and pressure over the Islamic Republic's nuclear programme.