Better oil deals in Iran

Participants listen to Iranian Oil Minister Bijan Namdar Zanganeh speech during the "Tehran Summit" in the Iranian capital on November 28, 2015. The aim of the summit is to strengthen Iran's international ties in regional and global domains and to attract economic cooperation in competitive global markets through using large share of Iran in petroleum and gas global reserves. AFP PHOTO / ATTA KENARE / AFP / ATTA KENARE

Iran has changed the way in which it offers contracts to foreign energy companies in an attempt to attract up to $30bn of new investment. The terms of the new oil contracts will be more favourable to foreign investors, who will be allowed a greater stake in long-term profits. 

Iran is preparing for the lifting of sanctions following the nuclear deal with six world powers in July. The country has some of the biggest oil and gas reserves in the world.

The new contracts were announced at a conference in Tehran attended by many of the world’s major energy companies. There were, however, no US companies present.

The new contracts put an end to the so-called buyback model, which has historically deterred foreign investors, where overseas contractors developed and operated an oil field before handing it over to Iran. Now, more lucrative longer-term contracts will be offered, where foreign companies can retain a stake in the field. About 50 oil and gas projects are expected to be unveiled during the Tehran conference, taking place on Saturday and Sunday. 

“The contract models introduced today are not perfect or ideal, but an effective and responsive model for both sides,” Oil Minister Bijan Namdar Zanganeh said.