Iran offers 50 oil projects to foreign investors

As many as 250 representatives of companies from 33 countries are attending the conference which will also feature Iran’s introduction of a new contract format offering better incentives to investors than the previous buy-back deal.

However, as Iranian fighters participated in a new Russian-led offensive against Syrian rebels, Iran’s leaders might have a reason to offer more details of their country’s involvement, said Ali Alfoneh, an Iran expert at the Washington-based Foundation for Defence of Democracies.

Anticipating the lifting of sanctions, Iran held a conference for foreign energy companies on Saturday and offered them about 50 oil and gas projects for development.

“To continue to play the role (as a major oil supplier), we hope to enjoy working with reputable worldwide oil companies under a win-win situation”, he told the conference.

The initial contracts will be for four years, with the option to extend by a further two years. “Europeans are interested, Asian companies are interested”, Mr. Zanganeh told reporters at a conference in Tehran on Saturday.

Zanganeh added that the entire processes of buying equipment and services should be put up for tender under the supervision of the National Iranian Oil Company.

“We have no objection to and problem with the participation of American companies”.

Iran will ask companies to bid a per barrel fee for energy projects, and they will be paid on a fixed fee basis only and will not receive a premium for producing more than predetermined levels, Talin Mansourian, a consultant for the Petroleum Contracts Restructuring Committee, said at the conference.

Iranian hardliners, however, condemned the new contracts as “unconstitutional”, saying they will open the way for “infiltration” of the energy sector by Iran’s enemies.

“The contract models introduced now aren’t flawless or ideal, however an effective and open model for either side”, Petroleum Minister Bijan Namdar Zanganeh said.

The buyback scheme proved hugely unpopular with multinationals and deterred investors even before United States and European Union sanctions over Iran’s nuclear program were tightened in 2012. Western nations have long suspected Iran of secretly pursuing nuclear weapons, charges denied by Tehran, which insists the program is entirely peaceful.

Iran announced it would revise its oil contracts two years ago following the election of moderate President Hassan Rouhani and the clinching of an interim nuclear agreement with world powers. In the mid-1970s, its oil output was as high as 6 million barrels per day. The country plans to pump an additional 500,000 bpd within a few weeks following the removal of the sanctions; the country produced 2.7 bpd of crude oil last month. Now, its oil production is a bit more than 3 million barrels per day.