The world's largest gas reserves may tempt some energy companies back to Iran if sanctions are lifted, but Tehran is unlikely to become a significant gas supplier to Europe or Asia for at least a decade, said experts.

European companies with the technology to fully exploit Iran's vast South Pars field under the Gulf abandoned it in the late 2000s, under US pressure, dashing its hopes of following Qatar's meteoric rise up the global gas exporters' league.

Last month's nuclear deal between the West and the new Iranian government has ignited hopes that its oil production could bounce back if Washington and the European Union relax controls on exports.

But Iran has little chance of becoming a significant gas exporter for at least a decade because of high domestic demand and internal obstacles to developing reserves, which were a problem long before sanctions forced foreigners out.

The lifting of sanctions on Iran "could potentially have a huge impact on exports over the longer term, but it will take years for things to get moving," Laurent Ruseckas, senior adviser on the Global Gas team at consultants IHS, said.

In the short term, it makes more economic sense for Iran to use gas to satisfy domestic demand for power generation and industry and for re-injection into ageing oilfields to maintain production, Ruseckas said.

Oilfield re-injection is a higher-value use for gas than exports, because oil sells for much more on the global market and does not require billions of dollars in capital investment in gas export projects that take years to pay back.

Over 1 trillion cubic feet of gas was re-injected to help boost oil production in 2011, according to the US Energy Information Administration, and some estimates indicate that over 8 bcf/d (around 83 bcm/year) will be needed within a decade.

Iran's marketed gas production, excluding flared and reinjected gas, has more than doubled to 160.5 bcm in 2012 from 75 bcm in 2002.

But Tehran has looked on while Qatar has become one of the world's richest countries after western energy companies built multi-billion dollar plants over the last decade that turned the tiny Gulf state into the world's largest liquefied natural gas (LNG) exporter.

The two countries share the world's largest gas field, which Iran calls South Pars and Qatar the North Field. It straddles their offshore Gulf border and accounts for nearly all of Qatar's gas production and around 35 percent of Iran's.

An abundance of condensate and natural gas liquids in the field means it can produce enough income to cover drilling costs before pumping out gas. That makes Iranian LNG export projects potentially highly competitive, even as supply swells due to U.S. shale gas and big finds off East Africa.

Phase 12 of the South Pars development, which is expected to start up next year, could boost supplies by as much as 28 bcm/year when it is fully operational.

"We have to make efforts to launch a section of this phase as soon as possible," Iran's oil and gas minister, Bijan Zanganeh, was quoted as saying by ministry website Shana during a recent visit to the sites. "Important petroleum industry projects must not be delayed due to waiting for the lifting of sanctions."

According to figures from the Pars Oil and Gas Company, which manages the whole project, phases 13 to 24 could add up to 142 bcm/year of capacity by 2019, if completed on time.

Iran already produces more gas than Qatar. The difference is that Qatar, with a population of less than 2 million, uses just 26 bcm of it, leaving 125 bcm free for export, according to data from BP.

Iran has used nearly all the gas it produces to supply its 77 million people with heat, electricity and fuel. Domestic demand has risen to 156 bcm in 2012 from 79 bcm in 2002, according to BP figures, which exclude gas used for re-injection.

Even if its domestic consumption rises at only the half annual growth rate seen over the past decade, that implies increases of 8-9 bcm every year over the next five years. That would take Iran's gas consumption to around 200 bcm/year in 2018, not counting its rising use for re-injection.

Iran has been a net importer for most of the past decade, and this year asked Turkmenistan for more supplies to help ease shortages that are forcing Iranian power plants to burn billions of dollars of pricey and polluting oil products.

Zanganeh said in October that Iran faces a 30 bcm shortfall in supplies this year and serious supply shortfalls over the next two years because South Pars has not been developed quickly enough.

Iranian gas projects have a record of falling far behind schedule.

Phase 13 suffered a big setback when one of its offshore platforms sank to the bottom of the Gulf during an installation attempt in January. Zanganeh said compressor problems with phases 17 and 18 might need the expertise of foreign companies to fix, Iranian news agency Shana reported last week.

On Saturday, the minister said he hoped most of phases 12, 15 and 18 would be complete by March 2015.

The previous government of President Mahmoud Ahmadinejad signed numerous gas export deals with Arab neighbours, devised plans to supply Europe via several pipelines, and planned gas-freezing LNG export plants to supply gas to Asia.

But Turkey has been the only country to receive significant volumes so far, and because of Iran's own winter heating needs, it has been unable to supply the 10 bcm/year contracted with Turkey.

Any gas that Iran can spare in future is likely to go to gas-hungry neighbours that have signed import contracts.

"It would be a strategic and semi-political choice on Iran's part, as well as a commercial one, but I don't imagine that Europe would be at the top of the queue," Ruseckas said.

The head of Iran's gas export company said over the weekend that it would pipe around 7 mcm/day to Iraq from next July, with flows rising to 25 mcm/day in 2015 and 40 mcm/day by the early 2020s.

If sanctions are lifted, Pakistan would probably be next in line for any spare gas, because Iran has spent hundreds of millions of dollars on building a 22 bcm/year pipeline, and the two countries say they will redouble efforts to finish the long-delayed project soon.

Iran has also agreed to pipe around 10 bcm/year to Oman within a few years and has built a pipeline to the United Arab Emirates designed to carry 10 bcm/year.

"Iran could export some more gas by 2025 but will not export in the range of 50 bcm/year before at least the 2030s," David Ramin Jalilvand said in a study published by the Oxford Institute for Energy Studies in June.

Zanganeh is already courting European energy giants in the hope they will swoop back in as soon as bans on investment are lifted.

Three large Gulf gas discoveries announced by Iran in 2011 - Kayyam, Farouz and Madar - are potential projects, and their exploitation could be a big boost to Iran's export hopes.

But building big LNG plants that take years to complete in a country that has had a tense relationship with the West for decades will be a daunting prospect for many energy companies, particularly at a time that the U.S. shale gas boom allows them to be picky over projects.

"There is something between zero to no chance of us going back into Iran," a western energy company executive said of Iran's gas sector.-Reuters