Iran is expected to approve a new model for oil contracts on Wednesday, paving the way for billions of dollars of foreign investment to help rebuild its energy industry.
“We are awaiting government approval due to be out on Wednesday,” Oil Minister Bijan Namdar Zanganeh said at an energy conference in Tehran on Monday. “Our priorities will be jointly owned oil and gas fields, as well as those in which we are after improved oil recovery.”
Iran has been working on the oil contract model for the past two years. The Persian Gulf country hopes to draw as much as $50 billion a year from major oil companies such as Italy’s Eni SpA and France’s Total SA to develop its oil and gas fields. Most of the companies that have expressed interest are European, Zanganeh said.
In an interview with Iran’s Seda Weekly magazine published in June, Zanganeh said the text of the investor-contract makes clear that domestic reserves belong to the state. Changes were also made to reflect demands that major decisions by the managerial committee of any joint venture be approved by the Iranian national oil company.
Iran was producing more than 4 million barrels a day before international sanctions were intensified against the country in 2012 because of its nuclear program. Since the restrictions were eased in January, Iran lifted crude production to 3.5 million barrels a day from 2.8 million barrels a day at the end of last year, according to data compiled by Bloomberg.
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