The first deals of the new generation of Iran’s oil sector contracts still need revisions but will be nonetheless awarded within the next few months, Iranian Oil Minister, Bijan Zanganeh said.
Zangeneh said that the government is yet to approve the new contracts, adding that the first deal is expected to be signed before October.
He further emphasized that Iran expects the upcoming awards to help increase its crude production by 600,000 to 700,000 barrels a day over five years.
The bulk of the surge will come from fields in an area west of the Karoun River along the Iraqi border, he stated.
Iran’s new format of oil contracts - generally known as Iran Petroleum Contract (IPC) – is replacing buyback deals. 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, NIOC will set up joint ventures for crude oil and gas production with international companies which will be paid with a share of the output.
Under the IPC, different stages of exploration, development and production will be offered to contractors as an integrated package, with the emphasis laid on enhanced and improved recovery.