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The Role of FSRU in Resolving Natural Gas Imbalances in Iran (Economic Assessment of FSRU Deployment and Lessons from European Experience)
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Gholamali Rahimi *   |
| IIES , alirahimigh2000@gmail.com |
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Abstract: (55 Views) |
Despite having the world's second largest natural gas reserves, Iran has been facing a growing imbalance in gas supply and demand since (2021). This situation, known in economic literature as the "paradox of abundance", is exacerbated during peak winter consumption to a daily deficit of 300 million cubic meters and is caused by a combination of international sanctions, insufficient investment in infrastructure, depletion of fields and networks, and especially excessive domestic consumption due to heavy energy subsidies; such that Iran's per capita energy consumption rate has been reported to be 15 times that of Japan and 10 times that of the European Union. This study examines the role of floating storage and regasification units (FSRUs) as a tactical and flexible solution for managing gas imbalances in the short and medium term. FSRUs, with their advantages such as short deployment time and lower initial cost, can be effective in compensating for Iran’s seasonal gas deficit. The key economic findings of this study show that deploying FSRU capacity equivalent to 15 million tons of LNG per year is feasible with a maximum initial investment cost of $500 million. In contrast, the net benefit from releasing and exporting this volume of liquid fuels is estimated to be $3.4 billion per year. This extraordinary economic ratio indicates that the cost of investing in FSRUs is less than 15% of the net benefit of the first year of replacement. On the other hand, analyzing the successful experience of the European Union after the Russia-Ukraine crisis, it becomes clear that the widespread deployment of FSRU under the REPowerEU program acted as a “strategic bridge” to fundamental reforms. By adopting this strategy and simultaneously implementing decisive demand management policies, Europe was able to reduce its dependence on Russian gas and achieve a 20% reduction in its gas consumption.
Key Words: imbalance, Iran, FSRU, supply, demand, storage
JEL Classification: Q2, A12, B4, T7.
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| Keywords: Key Words: imbalance, Iran, FSRU, supply, demand, storage
JEL Classification: Q2, A12, B4, T7. |
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Full-Text [PDF 845 kb]
(63 Downloads)
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Type of Study: Research |
Subject:
Energy Economic
Received: 2025/12/13 | Accepted: 2025/12/31 | Published: 2026/04/30 | ePublished: 2026/04/30
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