DUBAI: Iran has named 29 companies from more than a dozen countries 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.
Iran hopes its new IPC, part of an effort to sweeten the terms it offers on oil development deals, will attract foreign investors and boost production after years of sanctions.
The list did not include oil major BP. The Financial Times said BP had opted out of the bidding because of concerns over possible renewed US-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.
State-run National Iranian Oil Company (NIOC) signed the first oil output contract under the IPC model in October with an Iranian firm identified by the US 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 hard-line rivals of President Hassan Rouhani. It ends a buyback 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 that take into account oil price fluctuations and investment risks, 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 buyback contracts, which companies such as France’s Total or Italy’s Eni said made them no money or even incurred losses.
Iran’s currency
President Hassan Rouhani sought to reassure Iranians on Sunday that the government would work to protect market stability after the country’s currency fell to a record low last week.
“I am optimistic about the country’s economic situation and ... I want to reassure our people that foreign currencies will not keep going up,” Rouhani said in a live interview with state television.
Iran’s rial hit a record low against the US dollar last Monday in a sign of concern about the country’s ability to attract foreign money after Trump takes office.
If the rial’s weakness continues, it could become a political issue ahead of Iran’s presidential election in May by threatening some of Rouhani’s economic achievements. Rouhani, who took office in 2013, is expected to seek re-election but has not announced it officially.
Economists have said Trump’s election in November was a major factor in the rial’s weakness.
“The dollar has gained against all currencies in the past few months and it is natural if it also gains in Iran. But the rate of exchange of foreign currencies will certainly not remain at current levels,” Rouhani said, without giving details of how the government plans to defend the rial.
“The stability of (currency) markets is important for the government. The economy has to be predictable so that exporters and importers can act with trust,” he said.
Before Rouhani’s remarks, the rial strengthened to about 39,000 to the dollar on the free market on Sunday, after sliding to an all-time low of 41,500 last Monday.
The rial’s gains came after central bank Governor Valiollah Seif told state television on Saturday that he saw 36,000 rials per dollar as a “realistic” rate.
Seif was quoted as telling lawmakers that the central bank was injecting $5.8 billion in the market to defend the rial.
The currency traded at 35,570 in mid-September. Before December, the record low was about 40,000, hit in late 2012, traders said.
Besides the free market exchange rate, Iran uses an official rate, now at 32,375, for some state transactions.
Iran certifies 29 companies to bid for oil, gas projects
Iran certifies 29 companies to bid for oil, gas projects
