Iran to put its first IPC oil project on tender

Business Materials 30 August 2016 11:25 (UTC +04:00)

Baku, Azerbaijan, Aug. 30

By Emil Ilgar – Trend:

Iran would issue the first tender for oil and gas projects, based on its new contract model, called Iran Petroleum Contract (IPC), in the next Iranian month, Mehr (September 22 to October 22), Ali Kardor, the managing director of the National Iranian Oil Company (NIOC) said Aug 30.

He added that the tender of development of South Azadegan oil field would probably be the first IPC-based project which would be introduced to foreigners, Shana news agency reported.

Kardor said that he expects three projects based on the IPC to be signed with foreign companies by March 2017 and $10 billion to be attracted to Iran.

An Iranian official earlier told Trend that Iran produces 50,000 barrels of oil per day (b/d) of South Azadegan and another 30,000 b/d would be added to this volume in September. The official also said that the level would reach 110,000 b/d in and then 320,000 b/d, after another 132 wells are drilled.

The official said that currently 19 rigs are active there. The second phase would add another 280,000 b/d of barrel to the output of South Azadegan, but not in the near future.

Iran has introduced the IPC last December. It offers 50 upstream oil and gas projects for foreign partners on new, more attractive terms than the previous buyback contracts.

Iran has planned $185 billion worth of oil and gas projects by 2021 and hopes to attract foreign investments by using IPCs.

Despite the old contracts, IPC allows foreign companies to sign long-term contracts with Iran (20-25 years) and receive a percentage of produced oil as long as the field is active. It would encourage the foreign company to increase the field's recovery rate to receive more oil in the long term.