A six-percent block of Iran's North Drilling Company's shares will be offered on the Tehran Stock Exchange tomorrow as an initial public offering scheme for the purpose of price exploration.
According to the Mehr News Agency, the Iran Privatization Organization plan is intended for price exploration of the shares of NDC as the first privatization-bound subsidiary of the National Iranian Oil Company in the upstream oil sector.
"The price exploration process had been planned for the past Iranian calendar year (ended March 20, 2009), but it was postponed due to some problems," the official noted.
NDC is the Oil Ministry's third affiliate which is going to be privatized, after Fanavaran Petrochemical Company and Esfahan Oil Refinery went on public on February 3, and June 29, 2008 respectively.
Iran's Oil Ministry has released the list of 21 companies to be offered to the private sector in line with Article 44 of the Constitution.
Out of the companies, five belong to the National Iranian Oil Company, nine to the National Petrochemical Company, five are affiliates of the National Iranian Gas Company, and two of the National Iranian Oil Refining and Distribution Company.
According to Iran's Fourth Five-Year Economic Development Plan (2005-2010), Iran Privatization Organization, which is affiliated to the Ministry of Economic Affairs and Finance, is in charge of setting prices and offering shares to the general public on the stock market.
The current privatization effort calls for an initial public offering of five percent of the firms being privatized. Once the five percent is public, it will establish a market price on which further offerings can be based on.