The National Iranian Oil Company (NIOC) is in discussions with European companies to privatise gas stations in Iran, according to a senior official.

In an interview with MEED, Reza Dargahi, senior process engineer, corporate planning management, at NIOC,  subsidiary National Iranian Oil Refining & Distribution Company (NIORDC), said that discussions are ongoing to introduce European branding at fuel stations across the country.

“The ministry is looking to privatise gas stations in Iran – we’re looking for some famous companies for ownership of gas stations in Iran. We have a programme to control and privatise,” he said.

“We’re not only considering Iranian brands – at the moment we have around five brands in Iran – some of them have joined with foreign companies,” he added.

In late 2016, Iran’s economy ministry announced plans to privatise 40 gas stations, following a successful attempt to privatise a 100 earlier in the year.

The tendered stations were offered for a base price of $69.2m, the ministry said last year.

“Some European companies are interested in branding. This concept is very new. we’re looking to establish this branding in Iran,” says Dargahi.

“The price of gasoline and fuel in Iran is determined by the government and the market cannot determine this price. After the establishment of branding, we have a programme to let gasoline companies, private refining companies and,  after that, the foreign companies to bring project financing,” he added.

While Iran has invited pre-qualified international oil companies to develop its upstream oil and gas sector, its retail fuel distribution sector has largely been closed to foreign participation. In 2015, there were rumours that Anglo-Dutch major Shell and French energy giant Total – which has since entered the Iranian offshore gas sector through its investment in South Pars – were in discussions to participate in the retail fuel industry. Iranian officials denied the rumours.