TEHRAN, Iran – Iran is working on a new model for oil contracts for foreign investors, according to news service Shana.
The country’s Petroleum Ministry recently unveiled a draft of the new model, intended as a replacement for the former“buyback” contracts under which Total developed the Sirri field in the Persian Gulf prior to the implementation of sanctions against Iran.
Under a buyback deal, the host government agrees to pay the contractor an agreed price for all volumes of hydrocarbons the contractor produces.
However, under the new IPC contract, National Iranian Oil Co. (NIOC) will form joint ventures for crudeoil and gas production with international companies which will be paid with a share of the output.
In an unrelated move, Iran’s National Development Fund (NDF) will allocate more than $1 billion to upstream oil and gas projects over the next 12 months, according to NIOC official Moshtaq-Ali Gohari. Some of the funds will be directed atPhase 14 of the offshore South Pars gas field development.