The Iran Project

Iran outlines plan to win back Western oil interest: FT report

(Reuters) – Iran is planning to offer international companies more lucrative contracts to attract at least $100 billion worth of investment in its oilfields over the next three years, the Financial Times reported on Monday.

An adviser to Iran’s oil minister, Mehdi Hosseini, was quoted in the Financial Times article as saying the Islamic republic would scrap its current system of “buyback” contracts, which do not allow foreign companies to book reserves or take equity stakes in Iranian projects.

According to the article, Hosseini said a new “win-win” type of contract, details of which are expected to be announced in London next March, was in the works and leading companies could benefit, “whether American or European”.

Iran said last week that it would reach out to old oil buyers and was ready to cut prices if Western sanctions against it were eased, promising a battle for market share in a world less hungry for oil than when sanctions were imposed.

Iran’s crude exports were reduced by more than half after the European Union and United States tightened sanctions in mid-2012 in response to Tehran’s nuclear program.

A telephone conversation in September between Iranian President Hassan Rouhani and U.S. President Barack Obama revived market hopes for a diplomatic resolution that would lead to more Iranian oil in the marketplace.

The International Energy Agency (IEA) said this month, however, that few expected sanctions to be eased soon, despite the first high-level talks between Iran and the United States since Iran’s 1979 revolution.

Tehran nationalized its energy sector in 1979.

By Reuters


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