Business | Oil & Gas

Iran to offer energy projects for investment

Iran is preparing more than 15 major oil and gas projects involving a "new method" to attract local and foreign investment, the head of Iran's state-owned energy firm told state radio on Monday.

  • Reuters
  • Published: 23:25 August 4, 2008
  • Gulf News

Tehran: Iran is preparing more than 15 major oil and gas projects involving a "new method" to attract local and foreign investment, the head of Iran's state-owned energy firm told state radio on Monday.

It was not clear if the "new method" meant a revision of Iran's "buyback" terms for oil and gas deals which have been unpopular with foreign investors in the past.

The move comes as many particularly Western firms are reviewing investment plans in Iran or quitting because of a dispute with the West over the Islamic Republic's nuclear plans.

"The Islamic Republic of Iran will henceforth present its oil and gas projects using a new method to domestic and international investors," Seifollah Jashnsaz, managing director of the National Iranian Oil Company (NIOC), told state radio.

Buy-backs

Under so-called buy-backs, companies hand over operations of fields to NIOC after development and then receive payment from oil or gas production for a few years to cover their investment.

Foreign firms regularly complain that the terms are not generous enough, and some say they lose money on the deals. Oil officials were not immediately available to explain details of the "new method."

"We will prepare project packages ready to be introduced and submitted to international financial markets," Jashnsaz said.

"Each one of these packages is a major project and there are more than 15, so that we can attract foreign partners and new financial resources. We received a good reception in this respect from both European and Asian companies," he said.

He said that, of more than 15 projects, 10 would be put out to tender before the close of the Iranian year, which ends in March 2009.

Iran, with the world's fourth largest oil output, produces more than four million barrels of crude a day. But analysts say it needs the foreign technology, if not cash, to expand output.

StatoilHydro, which announced on Friday it would not make any further investments in Iran, is the latest in a series of foreign firms to back away from the Islamic Republic as perceived risk to investors has grown. France's Total said earlier this year it would spend no more money on Iranian gas projects for now.

  • Rate this article
  • Average reader rating (0 votes) 0 Stars
Tools

Emailing an article to friend is a simple way to share a news item. Your friend will receive an email with your name and email address as well any personal message you choose to send.

The information you provide on this page will not be used to send unsolicited emails.

This service is not intended to encourage spam, and action may be taken against individuals who maliciously enter personal details of another individual.

Share this article

More from Oil & Gas

  1. Oil may rise this week as dollar's plunge continues

  2. Mideast crude down on Qatar, Murban supply

  3. Oill prices fall below $76

  4. Al Hamili heads UAE team to OAPEC meet

All articles in Oil & Gas

More from Business

Gulf News
Popular in Business
Airlines in the region
Budget travel

Airlines in the region

Take a pictorial look at some of the budget airlines in GCC

Business Editor's choice