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27 February 2024

Iran plans $20bn investments

By Reuters

Iran is examining proposed foreign investments of up $20 billion (Dh73.4bn) in its energy sector, Oil Minister Massoud Mirkazemi said yesterday.

Mirkazemi did not name any of the foreign companies which he said had proposed such investments.

Western firms are increasingly wary of investing in the major oil producer due to an international row over Tehran's nuclear ambitions, but companies from energy-hungry Asian economies are seen as less susceptible to such pressures.

Analysts say Iran, the world's fifth-largest oil exporter, needs capital to help expand and modernise its energy industry. It also sits on the world's second largest gas reserves, but Western sanctions have slowed its development as an exporter.

"Currently, proposals on investment by foreign companies in Iran's oil and gas sector are being examined, whose value upon approval might be up to $20bn," Mirkazemi was quoted as saying by the official Irna news agency.

Mirkazemi said the average price for Iran's oil since the beginning of the Iranian year which started in March 2009 was about $63 a barrel.

"We sold our oil at $35 a barrel at the beginning of the year but the price is now more than $76 and we are hopeful that the average price of our oil will stand at between $67-68 by the end of the year," he said.

Mirkazemi also suggested the government's budget for 2010-11, due to be put forward to parliament soon, may be based on an oil price of $65.

Oil traded at about $78 a barrel on international markets yesterday, still down from a mid-2008 peak of about $147 despite a recovery since early 2009.


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