Iran's cabinet backs draft oil contract outline

TEHRAN, Sept. 30 (UPI) -- Iran's Oil Ministry said the executive branch has signed off on the general draft outlining contracts for the post-sanctions era for the country.

The ministry's official news agency SHANA said the cabinet approved a draft document outlining contracts for exploration, production and development of oil and natural gas fields in Iran.

Under the new terms, the National Iranian Oil Co. will set up joint ventures with foreign companies, which will be paid with a share of the output. Iranian Oil Minister Bijan Zangeneh said potential investors will get a sneak peak at the new contract terms at an investment conference planned for late October in Tehran.

"The companies that cannot make it in Tehran, can participate in the subsequent London conference," he said.

The National Iranian Oil Co. called on event organizer CWC Group to postpone the London conference from December to the end of February for unspecified reasons.

Iran said it expects to increase oil production and regain leverage with the Organization of Petroleum Exporting Countries with new contracts. Sanctions on Iran, however, limit some investment opportunities and Iran's president is retooling the economy to reduce the dependency on oil and gas revenue.

Though European energy companies are moving quickly, and the government said "all international" interest is welcome, most international oil companies said they're still minding sanctions targeting Iran's energy sector.

A recent report from analysis firm Verisk Maplecroft said that even if energy sanctions ease, some companies may still face difficulties as military entities tied to the conservative Islamic Revolutionary Guard Corps will remain blacklisted, adding a layer of complexity for companies looking to move into the Iranian market.