Iran Inks Deal to Sell Crude Oil to EU Firms

Iran Inks Deal to Sell Crude Oil to EU Firms

Iran Inks Deal to Sell Crude Oil to EU Firms

$OIL, $ENI, $REPYY, $TOT

Iran signed deals to sell Crude Oil to 7 European companies, that according to the semi-official Mehr news agency Sunday.

Long-term deals are signed with Saras SpA and Eni (NYSE:ENI) of Italy, Spain’s Repsol (OTCMKT:REPYY), Hellenic Petroleum SA of Greece, France’s Total (NYSE:TOT), Switzerland’s Vitol Group as well as Lukoil of Russia, executive director for international affairs at National Iranian Oil Company (NIOC) Mohsen Qamsari said.

“So far, agreements for the sale of nearly 700,000 BPD have been signed” with the European firms, Qamsari said, adding that the crude exports have been already started for the companies.

According to the report, Iran’s Crude Oil exports has reached 2.1-M BPD, from some 1-M BPD during the sanction period over the past years, and it is planned to hit a total of 2.5-M BPD by the end of Summer 2016.

The newly developed Iran Petroleum Contract (IPC) is 1 of the strategies Tehran has adopted to attract investment and upgrade the country’s oil industry, Iranian Deputy Oil Minister for International Affairs Amir Hossein Zamaninia said earlier this month.

To this end, the country is drawing up plans to draw US$185-B of investment in all sectors of the Oil industry within a 5-year frame, Mr. Zamaninia said, adding that US$85-B of the investment will go to the upstream sector of the industry.

Iran’s IPC, if implemented, would help the country attract financing from Asian and European investors. The new contracts are replacing traditional Iranian “buy-back” contracts which are no longer attractive to foreign companies.

Under the contracts, NIOC will set up JVs (joint ventures) for Crude Oil production with international companies which will be paid with a share of the output.

Iran and the world powers reached a nuclear deal last July, which was implemented in January and would enable the country to re-engage with energy firms of the world to develop its Oil & Gas fields.

Have a terrific week.

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