$185b Needed in Oil Investments

$185b Needed in Oil Investments$185b Needed in Oil Investments

Iran's oil industry needs investments worth $185 billion in the sixth five-year economic development plan (2016-21), said deputy oil minister for international affairs.

Amirhossein Zamaninia was speaking at the seminar titled "Iran Offshore Projects Outlook 2015" held in the Netherlands on October 27.

"In the imposed sanctions era the quality of Iran's oil and gas industry and engineering services have improved remarkably," Zamaninia was quoted as saying by Shana.

Underscoring the implementation of the nuclear accord clinched by Iran and the world major powers known as Joint Comprehensive Plan of Action, the official noted that Iran's economic ties with other states will develop further in the post-sanctions era.

Elaborating on Iran's political climate with respect to its attraction for foreign investors, Zamaninia said, "Stability of domestic economy, constructive foreign policy in international interactions and willingness to defuse international disputes based on international law are among the most important factors that have made conditions favorable for foreign investors in Iran."  

According to Zamaninia, transparency, predictable economic climate and officials' sense of commitment in providing guarantees to foreign investors make Iran a unique place to run major and serious business.

Highlighting the Iranian oil industry's attraction for investors, the official said plans have been made to attract $185 billion in investment to increase crude and gas condensate production capacity, optimize fuel consumption and promote energy efficiency during the sixth plan.

"The large volume of untapped oil and gas reservoirs, numerous proven oil reserves and relatively low extraction in proportion to exploitable oil compared to other regional oil players are some of the advantages of investing in Iran's oil industry," he said.

"Not only are the costs of extracting oil and skilled workers in Iran low compared to other countries, but engineering and technical operations are also of high quality."

Zamaninia believes that the sanctions era turned out to be a blessing in disguise, as it helped Iran reduce its dependency on oil revenues and improve its oil and gas industry and engineering services.

The two-day seminar, attended by senior Iranian oil managers and officials of foreign companies active in the offshore sector, opened on Tuesday in the Dutch town of Wassenaar.

Iran plans to produce 3.8 million to 3.9 million barrels of oil a day by March, with output rising by 500,000 barrels a day soon after sanctions are lifted and by 1 million barrels within the following five months.

Oil Ministry officials have declared that the Islamic Republic will reach the 500,000-bpd milestone by late November or early December even before most western sanctions are lifted.

Tehran has hosted top trade delegations from Spain, France, Germany, Brazil, Japan and South Korea, among others, in the past few weeks, preparing multibillion-dollar agreements in economic and energy sectors for the post-sanctions period.

Iran will lift the curtain on the framework of its multibillion-dollar oil contracts primarily in a conference in Tehran on November 28-20 and later in a seminar in the British capital London on February 22-24.

Officials say Tehran has sweetened the terms of the new contract to attract billions of dollars in foreign direct investment for up to 50 oil exploration and production projects, and revised some of the drawbacks of previous oil contracts, such as the terms of buyback contracts.