Long-term, profitable, contracts are a necessary prerequisite for attracting International Oil Company (IOC) participation in the Middle East’s oil sector, MEED’s Kuwait Projects 2013 conference has been told.

“There are two conditions that must be met if IOCs are to be attracted to a market,” Lionel Levha, general manager for French oil company Total in Kuwait, told the conference. “For one, they must be long term, and secondly, they must be profitable.”

Levha said contracts with IOC’s must be for a duration of 20-25 years if governments want to attract suitable interest.

“If a contract is only five years in duration, that is not enough time. It may take two and a half years to work out the best way [to proceed], and then there are only two and a half years to gain benefit,” said Levha.  “If contracts are 20 years, then there is plenty of time for IOCs and the client to benefit.”