Iran hopes to sign $25bn oil deals within 2 years

State-owned NIOC has identified 34 foreign companies as suitable bidders

The government hopes foreign companies will invest as much as $50bn a year in Iran’s oil industry.
The government hopes foreign companies will invest as much as $50bn a year in Iran’s oil industry.

Iran expects foreign oil companies to sign deals valued at $25bn over the next one to two years, under the terms of a new contract model approved last week.

The state energy producer plans to tender contracts over a period of six months to a year to develop several oil and gas fields, the oil ministry’s news service Shana has reported, citing Ali Kardor, the managing director of the National Iranian Oil Co. has said.

NIOC has identified 34 foreign companies as suitable bidders, he said. NIOC is also seeking investments under existing models, he said.

Iran approved the new contract model on August 3 in a push to bring foreign investment and technology to rebuild its energy industry, the largest sector of the economy.

The government hopes foreign companies will invest as much as $50bn a year in Iran’s oil industry. Major European oil companies, such as Italy’s Eni SpA and France’s Total SA, have expressed an interest in developing Iran’s oil and gas fields.

NIOC has identified 12 to 13 fields as a priority for the first round of investment, Kardor said, without naming the fields.

Oil Minister Bijan Namdar Zanganeh last week said Iran’s priorities would be jointly owned oil and gas fields, and producing assets where recovery rates could be improved.

International oil companies must form a joint venture with an Iranian partner under the new contract model. The government has approved eight Iranian E&P firms as eligible partners, and Kardor said this number was likely to increase.

Iran has already succeeded in meeting its pledge to regain market share it lost due to the sanctions over its nuclear programme.

Iran has boosted crude output to 3.85mn bpd, the Fars news agency reported last week, citing comments made by Zanganeh in parliament. That would be the highest since December 2008, according to data compiled by Bloomberg.

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