EghtesadOnline: Parliament on Saturday ratified a law that allows the government to issue bonds in the next fiscal year for developing major oil and gas projects.
As part of the legislation for the national budget for fiscal 2017-18, the Majlis passed a law that allows the government to issue up to 50 trillion rials (about $1.3 billion) in bonds for investment in hydrocarbon resources, IRNA reported.
The law places higher priority for investment in shared oil and gas fields, stipulating that investors should be remunerated from revenues from the joint fields.
Saleh Hendi, the director for exploration at the National Iranian Oil Company, said on Saturday that the government has allocated "close to $2 billion" for oil and gas exploration, Financial Tribune reported.
"The entire budget will go for drilling operations," Hendi said, adding that preliminary studies on each oil and gas reservoir cost between $200 million to $300 million.
However Tehran's exceedingly tight budget does not measure up to its energy aspirations.
Oil Minister Bijan Namdar Zanganeh has said the country needs a staggering $200 billion for investment in its petroleum industry, including $130 billion for upstream exploration and production.
Tehran has pinned high hopes on developing its energy infrastructure with foreign finance and technology.
The government of President Hassan Rouhani plans to tender dozens of oil and gas fields under a new model of contracts that offers sweeter terms, such as production for up to 20 years and higher reward for riskier projects.
The fields that are shared with Iraq and Qatar, namely the oilfields in the West Karun region in southern Khuzestan Province and the South Pars Gas Field in the Persian Gulf, are among the country's coveted projects.
Iran has the world's second-largest proven natural gas reserves (34 trillion cubic meters) and the fourth-largest crude oil reserves (157 billion barrels). Based on estimates, Iran can draw on its oil and natural gas reservoirs for at least 50 and 80 years respectively, excluding the new discoveries.