A critical review on the legal regime of New Iranian Petroleum Contracts and response to them

Document Type : Research Paper

Authors

1 PhD student of Oil and Gas Law, University of Tehran, Faculty of Law and Political Science

2 Associate Prof. of University of Tehran, Faculty of Law and Political Science

Abstract

Over the last decades, the buy-back contract model kept evolving over the last 3 generations. Despite its significance, it was always faced with heavy criticism. After sanctions against Iran and the occurrence of the Joint Comprehensive Plan of Action (JCPOA), there was a crucial need of international investment by joining foreign investors and domestic contractors on behalf of the host government. Thus, there was a vital need for an enhanced model contract after changes in laws allowing this agreement. Because most of Iran’s current reservoirs have been depleted, it is essential to do sustainable exploitation with a maximum efficient rate of recovery including prioritizing the use of shared reservoirs. This lead to the enactment of a new model of oil and gas contracts called Iranian Petroleum Contracts, also known as IPC. This new model has its own flaws in the legal regime and is faced with criticism just as with the previous model. This paper attempts to analyze and respond to these critical arguments. Although there are some gaps in the model, especially in the operating phase, it can pave the way for the advancement of legal and fiscal regimes leading to further foreign investment and future contracts, in hopes to strengthen Iran’s position in OPEC and world trade of oil and gas for long-term

Keywords

References

Groenendaal, Willem J.H. van, and Mohammad Mazraati (2006) "A Critical Review of Iran's Buyback Contracts", Energy Policy, Vol. 34, No. 18, pp. 3709-3718.
Abd Ghadas, Zuhairah Ariff, and Sabah Karimsharif (2014) "Types and Features of International Petroleum Contracts", South East Asia Journal of Contemporary Business, Economics and Law, Vol. 4, No. 3, pp. 34-41.
Acheampong, Theophilus, Marcia Ashong, and Victoria Crystal Svanikier (2016) "An Assessment of Local-Content Policies in Oil and Gas Producing Countries", World Energy Law & Business, Vol. 9, No. 4, pp. 282–302.
Ghandi, Abbas, and C.Y. Cynthia Lin Lawell (2017) "On the Rate of Return and Risk Factors to International Oil Companies in Iran's Buy-Back Service Contracts", Energy Policy, Vol. 103, No. 18, pp. 16–29.
Maugeri, Leonardo (2016) “The Global Oil Market: No Safe Haven for Prices”, United States of America: Harvard Kennedy School, Belfer Center for Science and International Affairs.
Pongsiri, Nutavoot (2004) "Partnerships in Oil and Gas Production-Sharing Contracts", The International Journal of Public Sector Management, Vol. 17, No. 5, pp. 431-442.
Schramm, Carollin, Alexander Meibner, and Gerhard Weidinger (2010) "Contracting Strategies in the Oil and Gas Industry", Pipeline Technology, pp. 33-36.
Taverne, Bernard G. (2013) Petroleum, Industry and Governments: A Study of the Involvement of Industry and Governments in Exploring for and Producing Petroleum. 3rd. Wolters Kluwer Law & Business.
Yeganehshakib, Reza (2015) “Iran Petroleum Contract Bill: Risks and Benefits for Foreign Investors”, https://www.azernews. az/news.php? news_id=89972&cat=region. November 20, (2019).
Youssef, Ali. Jun 13 (2018) "The New Iraqi Oil Licensing Round: A Fiscal Perspective." 1001 Iraqi Thoughts. https://1001iraqithoughts .com/2018/06/13/the-new-iraqi-oil-licensing-round-a-fiscal-perspective/ 27 Jan, (2020).
Journal of Legal Studies
Volume 12, Issue 4 - Serial Number 38
January 2021
Pages 105-136

Files

Share

How to cite

Statistics