Iranian authorities reported the start-up of the 12.7 bcm/y (35 mcm/d) Damghan-Neka gas pipeline construction phase. The route will stretch from the city of Damghan in Semnan Province (Iran) up to Neka in Mazandaran Province (Iran, Caspian Sea coastline) and the project is meant to reduce significantly the domestic gas imports from Turkmenistan. Instead, the pipeline will be part of a network of facilities used to transfer natural gas from the South Pars field in the Persian Gulf all the way to the northern regions of Iran.
The country is trying to reduce its dependency towards Turkmen gas supplies, which were stopped unexpectedly in 2016 because Turkmenistan complained of a violation of the terms of its supply contract with Iran, which in turn increased dramatically the Iranian domestic gas prices. The deal was breached and gas supplies were cut temporarily. Iran has imported natural gas from Turkmenistan since 1997 in order to supply the northern parts of the country, which are located far away from the gas resources in the south.
In the meantime, Iran's gas production capacity has reached 885 mcm/d and the South Pars field phases are progressing. Out of the 24 phases, Phases 1-10 are intended for domestic consumption, while gas from the other phases should be exported to neighbouring countries.