TEHRAN – Iranian Oil Minister Bijan Namdar Zanganeh says the country’s new model of oil contracts, dubbed as Iran Petroleum Contract (IPC), is expected to attract some $30 billion.

Zanganeh believes that this volume of investment, once materialized, would be a breath of fresh air into the country’s oil industry, hereby helping the lessening of challenges the industry is grappling with, the Shana news agency reported on Wednesday.

Iranian top oil decision makers are going to formally unveil the IPC in a ceremony to be held in Tehran on November 28-29.

Although Iranian authorities have been keeping a lid on the content of the model under which tens of upstream oil projects are envisaged to be introduced, there has been some leakage.

For example, all exploration, development, and production stages of oil projects are transferred as a pack to customers as an incentive to participate in the market.

Besides, investors are not allowed to transfer oil reservoirs to other companies.

Technology transfer, financial transparency, and enhanced oil recovery are among other measures taken into consideration in the model.

Moreover, the IPC is expected to replace “buy-back” contracts, in which foreign investors show no interest.

Under a buyback deal, the host government agrees to pay the contractor an agreed price for all volumes of hydrocarbons the contractor produces.

But under the IPC, the National Iranian Oil Company will set up joint ventures for crude oil and gas production with international companies which will be paid with a share in the output.

Foreign companies are expected to rush back to Iran as hopes soar for relief in sanctions imposed on the Islamic Republic over its nuclear program.  

AK/