Iranian cabinet ministers have approved a model contract under which non-Iranian companies might participate in oil and gas exploration and development (OGJ Online, Feb. 23, 2016).
If approved by the parliament, the new Iran Petroleum Contract would replace the buy-back contract Iran has offered with limited success since the early 1990s.
The Islamic Republic News Agency reported the approval of the IPC but offered no details about the structure.
The buy-back model is a risk-service contract that limits non-Iranian participation to 7 years and pays contractors a fixed fee unrelated to production rates.
At a meeting in Tehran last November, Iranian officials indicated the IPC would be a service contract under which non-Iranian companies would participate as minority partners in joint ventures with Iranian companies.
The IPC, according to officials at the meeting, would have a 25-year term and a fee structure more flexible than that of the buy-back model.