Iran to sign first new model oil contract in 3 months

Business Materials 10 July 2016 14:13 (UTC +04:00)

Baku, Azerbaijan, July 10

By Emil Ilgar - Trend:

Iran would sign the first new model oil contract in 3-4 months, Amir Hossein Zamaninia, deputy petroleum minister for international and commerce affairs, said July 10.

"Iran's priority is to develop the joint fields, as well as enhance the recovery index", Shaha quoted him as saying during a press conference in Tehran.

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

Foreign companies must find an Iranian partner among companies.

Before, National Iranian Oil Company has only been authorized to sign buyback or engineering, procurement, construction and finance (EPCF) contracts. IPC allows foreigners to have a share in production, but they wouldn't have any share in reserves.

He added that for next five years, developing up/mid/downstream projects, worth $185 billion have been projected, while it is expected to attract $40-$50 billion (foreign) investment for developing these projects.

Iranian hardliners oppose IPC, saying that it is against the national interest, but foreign companies, including France's Total, have announced repeatedly that the older type of Iranian oil and gas contracts are not attractive anymore.

Zamaninia added that during last two years, Iran has negotiated with more than 150 companies and governments over the projects, but no contract has been signed yet.

He added that Iran possesses the world's biggest oil and gas reserves, but its share in global production is little.

Iran's proved oil and gas reserves stand at 158 billion barrels and 34 trillion cubic meters. The country also produces daily 735 million cubic of gas and 3.5 million barrels of crude oil.

All of the produced gas is consumed domestically, (Iran's gas export and imports are equal), while the country exports about 2.1 million barrels per day of crude oil.

Iran has 27 join oil and gas fields with neighbors, some of them, especially those which are joint with Iraq have been included in IPC.