News / Middle East

Iran Courts Indian Companies with More Alluring Oil Contracts

FILE - The front of the National Iranian Oil Refining and Distribution Company building is seen in Tehran, November 17, 2009.FILE - The front of the National Iranian Oil Refining and Distribution Company building is seen in Tehran, November 17, 2009.
x
FILE - The front of the National Iranian Oil Refining and Distribution Company building is seen in Tehran, November 17, 2009.
FILE - The front of the National Iranian Oil Refining and Distribution Company building is seen in Tehran, November 17, 2009.
Reuters
Iran has offered new, more alluring terms to reluctant Indian companies to win the investment it craves for its decaying energy sector suffering from tight Western sanctions.
 
Iran started offering production sharing contracts (PSCs), long denied to investors, to a group of Indian oil executives visiting Tehran in January, an Indian industry source said on Thursday.
 
Tehran's insistence, until now, on paying contractors back in oil made projects unattractive to foreign firms even before sanctions made it nearly impossible for most to work there.
 
Iranian Foreign Minister Ali Akbar Salehi pictured in Nicosia, Cyprus on June 26, 2012.Iranian Foreign Minister Ali Akbar Salehi pictured in Nicosia, Cyprus on June 26, 2012.
x
Iranian Foreign Minister Ali Akbar Salehi pictured in Nicosia, Cyprus on June 26, 2012.
Iranian Foreign Minister Ali Akbar Salehi pictured in Nicosia, Cyprus on June 26, 2012.
Iranian Foreign Minister Ali Akbar Salehi repeated the production sharing offer during an India-Iran Joint Commission meeting with Indian external affairs minister Salman Khurshid in Tehran last weekend, Indian media reported.
 
Indian firms say the risks of investing large sums in Iran are still too great, even with a more attractive PSC regime.
 
“We expressed our reservations because of international sanctions and non-availability of services and material required for execution projects,'' said a source who was involved in talks with Iran on potential upstream activities in January.
 
Three Indian companies with stakes in a gas field in Iran - Indian Oil Corp., ONGC Videsh and Oil India - told a U.S. government watchdog late last year that they had no plans to pursue further work on the project.
 
According to Iranian media reports, the National Iranian Oil Company (NIOC) has been drafting production-sharing contracts in the hope of attracting Asian companies, which are not banned by their governments from operating in Iran, to invest in its rundown industry.
 
Indian press reports said that the two foreign ministers discussed PSCs on Saturday at their meeting in Tehran.
 
A statement published by the Indian foreign ministry after the meeting said the two sides agreed to study joint investment prospects in both countries but made no mention of energy agreements.
 
The two ministers did discuss India working to upgrade Iran's Chahbahar Port near the border with Pakistan to help boost trade with land-locked Afghanistan to the north, according to the Indian statement.
 
“We are determined to explore and use all capacities for economic cooperation,'' Khurshid was quoted as saying in a statement published by the Iranian foreign ministry.
 
Under Iran's established buy-back system, contractors are supposed to be paid in oil and gas from projects they develop with their own capital but then have to hand back the project to Iranian companies when completed and wait for pay back.
 
This system has kept oil majors like Italy's Eni waiting for multi-million-dollar payments for projects they completed decades ago, while sanctions make it still more difficult to get the oil from Iran.
 
Under the new contracts, NIOC plans to transfer development of small oil and gas fields to contractors so that the state-run Iranian oil company plays only a supervisory role, NIOC director Ahmad Qalebani was reported as saying by Fars News in March.
 
PSC's would only be offered for shared fields, he was quoted as saying during a meeting in Tehran on the development of Iran's contracting system in March.
 
Iran has been courting Asian and Russian energy companies to develop its vast oil and gas reserves over the last few years, and there are still a number of Chinese and Russian companies working in upstream projects, according to the U.S. government.
 
Western sanctions have also dampened their appetite for long-term investments in the isolated Islamic Republic, on current contract terms, with Chinese companies slamming the brakes on projects they agreed to develop years ago.
 
Under pressure from Washington, India and China - two of Iran's biggest oil buyers - have also sharply reduced their imports of Iranian crude over the last year.

You May Like

Somalia: No Popular Elections in 2016

In interview Wednesday with VOA, President Mohamud says 'one person, one vote' elections will not be possible due to continuing insecurity More

Scientists Predict Climate Change Will Increase Child Malnutrition

Public health expert in Germany says that by 2050, 25 million more children's lives will be put at risk because of lack of nutrients tied to climate change More

Erdogan in China Amid Tensions on Uighurs, Missile System

Turkey's president has criticized China's heavy-handed policies toward Uighurs in violence-plagued Xinjiang region, where China says it is fighting foreign-backed separatists More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Russia Accused of Abusing Interpol to Pursue Opponentsi
X
Henry Ridgwell
July 28, 2015 9:53 PM
A British pro-democracy group has accused Russia of abusing the global law enforcement agency Interpol by requesting the arrest and extradition of political opponents. A new report by the group notes such requests can mean the accused are unable to travel and are often unable to open bank accounts. VOA's Henry Ridgwell reports.
Video

Video Russia Accused of Abusing Interpol to Pursue Opponents

A British pro-democracy group has accused Russia of abusing the global law enforcement agency Interpol by requesting the arrest and extradition of political opponents. A new report by the group notes such requests can mean the accused are unable to travel and are often unable to open bank accounts. VOA's Henry Ridgwell reports.
Video

Video Genome Initiative Urgently Moves to Freeze DNA Before Species Go Extinct

Earth is in the midst of its sixth mass extinction. The last such event was caused by an asteroid 66 million years ago. It killed off the dinosaurs and practically everything else. So scientists are in a race against time to classify the estimated 11 million species alive today. So far only 2 million are described by science, and researchers are worried many will disappear before they even have a name. VOA’s Rosanne Skirble reports.
Video

Video Scientists: One-Dose Malaria Cure is Possible

Scientists have long been trying to develop an effective protection and cure for malaria - one of the deadliest diseases that affects people in tropical areas, especially children. As the World Health Organization announces plans to begin clinical trials of a promising new vaccine, scientists in South Africa report that they too are at an important threshold. George Putic reports, they are testing a compound that could be a single-dose cure for malaria.
Video

Video Special Olympics Athletes Meet International Friends

The Special Olympics are underway in Los Angeles, California, with athletes from 165 countries participating in an event that gives people with intellectual disabilities the chance to take part in an international competition. VOA's Mike O'Sullivan reports that for athletes and their families, it's also an opportunity to make new friends in an international setting.
Video

Video 'New York' Magazine Features 35 Cosby Accusers

The latest issue of 'New York' magazine features 35 women who say they were drugged and raped by film and television celebrity Bill Cosby. The women are aged from 44 to 80 and come from different walks of life and races. The magazine interviewed each of them separately, but Zlatica Hoke reports their stories are similar.
Video

Video US Calls Fight Against Human Trafficking a Must Win

The United States is promising not to give up its fight against what Secretary of State John Kerry calls the “scourge” of modern slavery. Officials released the country’s annual human trafficking report Monday – a report that’s being met with some criticism. VOA’s National Security correspondent Jeff Seldin has more from the State Department.
Video

Video Iran Nuclear Pact Wins Few New US Congressional Backers

Later this week, President Barack Obama returns from a trip to Africa to confront a U.S. Congress roiled by the nuclear accord with Iran, an agreement that has received the blessing of the U.N. Security Council. Days of intensive lobbying and testimony by top administration officials have won few new congressional supporters of the pact. VOA’s Michael Bowman reports.
Video

Video Washington DC Underground Streetcar Station to Become Arts Venue

Abandoned more than 50 years ago, the underground streetcar station in Washington D.C.’s historic DuPont Circle district is about to be reborn. The plan calls for turning the spacious underground platforms - once meant to be a transportation hub, - into a unique space for art exhibitions, presentations, concerts and even a film set. Roman Mamonov has more from beneath the streets of the U.S. capital. Joy Wagner narrates his report.
Video

Video Europe’s Twin Crises Collide in Greece as Migrant Numbers Soar

Greece has replaced Italy as the main gateway for migrants into Europe, with more than 100,000 arrivals in the first six months of 2015. Many want to move further into Europe and escape Greece’s economic crisis, but they face widespread dangers on the journey overland through the Balkans. VOA's Henry Ridgwell reports.
Video

Video Stink Intensifies as Lebanon’s Trash Crisis Continues

After the closure of a major rubbish dump a week ago, the streets of Beirut are filling up with trash. Having failed to draw up a plan B, politicians are struggling to deal with the problem. John Owens has more for VOA from Beirut.
Video

Video Paris Rolls Out Blueprint to Fight Climate Change

A U.N. climate conference in December aims to produce an ambitious agreement to fight heat-trapping greenhouse gases. But many local governments are not waiting, and have drafted their own climate action plans. That’s the case with Paris — which is getting special attention, since it’s hosting the climate summit. Lisa Bryant takes a look for VOA at the transformation of the French capital into an eco-city.
Video

Video Racially Diverse Spider-Man Takes Center Stage

Whether it’s in a comic book or on the big screen, fans have always known the man behind the Spider-Man mask as Peter Parker. But that is changing, at least in the comic book world. Marvel Comics announced that a character called Miles Morales will replace Peter Parker as Spider-Man in a new comic book series. He is half Latino, half African American, and he is quite popular among comic book fans. Correspondent Elizabeth Lee reports from Los Angeles.
Video

Video Critics of Japan Defense Policy Focus on Okinawa

In Okinawa, many locals have long complained that Tokyo places an unfair burden on the tiny island by locating most of Japan's U.S. military bases there. As Japan's government moves toward strengthening and expanding the country's defense policies, opponents of those plans are joining local protesters in Okinawa, voicing concern about where the country is headed. VOA’s Brian Padden reports from Okinawa.
Video

Video IS Uses Chemical Weapons in Syrian Attack

Islamic State militants have added a new weapon in their arsenal of fear: chemical weapons. VOA Kurdish service reporter Zana Omer was on the scene within hours of a recent attack in Hasakah, Syria, and has details of the subsequent investigation, in this report narrated by Miguel Amaya.
Video

Video Historic Symbol Is Theme of Vibrant New Show

A new exhibit in Washington is paying tribute to the American flag with a wide and eclectic selection of artwork that uses the historic symbol as its central theme. VOA’s Julie Taboh was at the DC Chamber of Commerce for the show’s opening.

VOA Blogs