29 International companies certified by Iran to bid for O&G projects.

Blog Post created by sksingh on Jan 2, 2017

29 companies from more than a dozen countries have been named by Iran as being allowed to bid for oil and gas projects using the new, less restrictive Iran Petroleum Contract (IPC) model, the oil ministry news website SHANA reported on Monday.

The list of pre-qualified firms included Shell, France's Total, Italy's Eni, Malaysia's Petronas and Russia's Gazprom and Lukoil, as well as companies from China, Austria, Japan and other countries.

The new IPC has been devised by Iran as part of an effort to sweeten the terms it offers on oil development deals, attract foreign investors and boost production after years of sanctions.

However, the list did not include oil major BP. It was reported that BP had opted out of the bidding because of concerns over possible renewed U.S.-Iran tensions after President-elect Donald Trump takes office on Jan. 20.

Trump has said he will scrap the deal between Iran and world powers that imposed curbs on Tehran's nuclear projects and lifted sanctions on the Iranian economy last January.

The first oil output contract under the IPC model was signed by the State-run National Iranian Oil Company (NIOC) in October with an Iranian firm identified by the United States as part of a conglomerate controlled by Iran's Supreme Leader Ali Khamenei.

The IPC model has been delayed several times due to opposition from hardline rivals of President Hassan Rouhani. The recent happenings end a buy-back system dating back more than 20 years under which Iran did not allow foreign firms to book reserves or take equity stakes in Iranian companies.

The new IPC has more flexible terms, and oil price fluctuations and investment risks shall be taken into account, a senior Iranian oil official told Reuters in November.

Oil majors have said they would only go back to Iran if it makes major changes to the buy-back contracts, which companies such as France's Total or Italy's Eni said made them no money or even incurred losses.

Source: Reuters