Iran to develop oilfields through 3 kinds of contract

Business Materials 6 July 2016 18:17 (UTC +04:00)

Tehran, Iran, July 4

By Mehdi Sepahvand – Trend:

Iran will develop its oilfields using three kinds of contract, CEO of the National Iranian Oil Company (NIOC) Ali Kardar said.

Accordingly, a number of the fields will be developed using either buyback or engineering, procurement, construction and finance (EPCF) contracts, the official said, SHANA news agency reported July 4.

As for joint fields, they will be offered via a new form of contracts, he stated.

In the meantime, he said, the NIOC will be responsible for a small portion of the funding of the projects, and its investments will be mostly limited to production and storage.

In 2015, the Iranian Oil Ministry unveiled its new oil contracts called Iran Petroleum Contracts (IPCs), aimed at luring foreign fund and technology, and having foreign companies choose an Iranian partner.

Through nearly 90 years of the Iranian oil industry, only the NIOC has been authorized to carry out exploration and production (E&P) projects.

But recently the Oil Ministry announced a tender to have the willing companies pick E&P projects. None of the tens of companies that registered met the minimum requirements needed for the job. As a result, the ministry lowered its standards to half their original levels to make a few companies qualify.

On July 3, Deputy Oil Minister for Research and Technology Mohammad Reza Moqaddam said eight companies had been recognized as meeting the requirements, and would therefore be introduced to foreign investors as partners.

He named the companies as Petropars, OIEC (Oil Industries Engineering and Construction), Dana Energy, PetroIran Development, Mapna Oil and Gas Co., Khatam ul-Anbiya Construction Camp (Subsidiary of the Islamic Revolution Guards Corps aka IRGC), Iran Industrial Projects Management Co. (subsidiary of Iran Industries Development and Renovation Organization), Persia Oil and Gas Development Co. (subsidiary of The Execution of Imam Khomeini's Order aka EIKO).