News / Energy

Iran eyeing new oil awards to giants

Monday, 26 December 2016 5:56 PM [ Last Update: Monday, 26 December 2016 5:56 PM ]

An aerial view of the platform of South Pars Phase 18 in the Persian Gulf. (Photo by Shana)

Iran says it expects to award at least 10 new contracts for the development of oil and gas projects to international energy companies in the near future.

Gholam-Reza Manouchehri, the deputy for development and engineering affairs of the National Iranian Oil Company (NIOC), was quoted by the domestic media as saying that 12 contracts had already been awarded to companies since the removal of sanctions against Iran in January.

Manouchehri emphasized that Iran’s oil sector projects were particularly attractive to global investors given the low risks as well as the low costs involved.

“The costs of producing oil and gas in Iran are very low compared to other countries,” he told Iran’s IRNA news agency. “This has already increased the motivation of international companies to approach Iran’s oil and gas projects”.

The first major contract that Iran awarded after the removal of the sanctions was one for the development of Phase 11 of the country’s South Pars gas field. The contract was awarded in November to a consortium led by France’s Total.

Another major contract was one that was shortly afterwards signed with the global energy giant Shell for studying three major oil and gas fields in southern Iran.

For multiple years, Iran was under a draconian US-led regime of sanctions that banned investments by international companies in the country’s oil sector projects among other numerous restrictions.

The sanctions were lifted in January after a nuclear deal that Iran sealed with the five permanent members of the Security Council plus German – the so-called P5+1 group of countries – came into effect.

The deal envisaged certain steps by Iran to restrict some aspects its nuclear energy activities in return for moves by the P5+1 to lift certain economic sanctions against the country.

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