Iran’s private sector to use NDF for financing oil projects

Business Materials 18 November 2014 11:28 (UTC +04:00)

Tehran, Iran, Nov. 18

By Milad Fashtami - Trend:

A member of the Energy Commission of Iranian Parliament (Majlis) Seyyed Mehdi Mousavinejad said that the country can use the National Development Fund to finance oil projects.

Mousavinejad told Trend Agency on Nov. 18 said that according to law, the oil ministry cannot use the fund directly.

"The private sector can use the money to carry out major oil projects in the country," he said.

According to Mousavinejad, there is no limit for using NDF for oil projects.

Iranian Oil Minister Bijan Zanganeh said last week that the country plans to use the National Development Fund to cope with damage to its economy from plunging global oil prices

"By drawing upon its National Development Fund to reimburse contractors active in upstream projects, Iran will make up for the impact of the oil revenue decline on these projects," Zanganeh said.

Iran's National Development Fund is worth about $62 billion.

The NDF is Iran's sovereign wealth fund. It was founded in 2011 to replace Oil Stabilization Fund.

Based on Article 84 of the Fifth Five-year Socio-Economic Development Plan (2011-2015), the National Development Fund was established to transform oil and gas revenues to productive investment for future generation.

Some 23 percent of the revenues from the mentioned sources went into the NDF in 2013. This share will reach 32 percent by the end of 2016.