Iran names local partners for western energy majors

Jun 23, 2016 12:00 AM

Iran has confirmed the names of five Iranian companies that it has identified as partners for international energy majors seeking to invest in the Islamic republic, taking it a step closer to opening up its oil and gasfields to western investment.

Gholamreza Manouchehri, the deputy head of the National Iranian Oil Company (NIOC), told that the companies already selected included government-backed Petroiran, Petropars and Mapna Group. But he said that a complete list was still being finalised.

The names of the companies has been eagerly awaited by western energy companies such as BP, Total and Eni, as they hope to gain access to the Opec member’s oil and gas reserves after years of sanctions.

Many sanctions were lifted after Tehran reached a deal last year with world powers to scale down its nuclear activities.

Iran, which sits on the world’s fourth-largest oil reserves and some of its largest gas reserves, has since been courting investors but has delayed announcing the terms of its contracts.

It has roughly doubled oil exports to more than 2m barrels a day since January, and is seeking to attract almost $200bn of western investment to boost production by at least 600,000 barrels a day within five years.

Bijan Namdar Zanganeh, Iran’s oil minister, said on Sunday that Iran, once the second largest Opec producer, expected to sign a first post-sanctions oil contract with a foreign company within three months.

But US energy majors, including ExxonMobil and Chevron face an additional wait as Washington maintains sanctions prohibiting US entities dealing with Iranian companies, with a few special cases such as airlines, despite the nuclear accord.

Boeing this week agreed a provisional deal to sell jetliners to Iran Air, the state carrier, becoming the first large US company to net a potential multibillion-dollar deal since the nuclear deal.

Of the energy companies selected, Petroiran is a subsidiary of the National Iranian Oil Company and is tasked with onshore and offshore development.

Petropars, another state-linked entity, has signed a memorandum of understanding with one German company and has already held talks with western majors, according to Iranian media.

Mapna is an Iranian power and infrastructure group. It signed an agreement with Siemens in March that will see the German company provide two gas turbines to a power plant in the southern port of Bandar Abbas.

Oil Industries Engineering and Construction group (OIEC) is a partly state-owned oil contractor, while Industrial Development and Renovation Organisation of Iran (IDRO) is a conglomerate active throughout Iran’s economy.

Mr Manouchehri gave the list in response to queries about names revealed by an Iranian journalist at the oil ministry’s in-house news service. The list also included companies Danaenergy, Jahanpars and Petrogohar, which have yet to confirmed by the ministry.

Mr Zanganeh, the oil minister, appointed Ali Kardor, whose background is in finance, as the new head of the National Iranian Oil Company last week. The appointment was seen as an attempt to tackle financial issues, which along with unattractive terms of contracts and low oil prices, have hampered new oil projects.

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