Kardor told the conference that Iran has so far attracted foreign investment in upstream oil and gas worth $29,500 million in buy-back contracts since the energy sector was opened up to IOCs. NIOC has itself invested $12,700 million.

'We forecast that we will need about $59,400 million during the next decade for our development activities,' he said. More than half would be devoted to the oil sector, where direct foreign investment other than through buy-back deals is not permitted. The rest will go to the gas sector, where more than $11,000 million is forecast to come from non buy-back financing activities (see table).

Kardor said that Iran aims to have oil production capacity of 5.6 million barrels a day (b/d) by the end of 2010 and 7 million b/d in 2020. The amount of oil produced using enhanced oil recovery methods is projected to rise to 30 per cent of the total in the fourth five-year development plan, from 27 per cent at present. Gas will account for 63 per cent of Iran's total energy consumption in 2020, compared with 50 per cent in 2003. The Fuel Conservation Organisation has been set up to help replace domestic consumption of liquid fuels with gas.

Kardor said that NIOC will develop relations with the EU, China and India in order to capture part of their natural gas markets. 'European and Far East companies, which will have an active role in marketing Iranian natural gas in the coming decades, will certainly gain a considerable share of Iran's upstream contracts,' said Kardor. A total of $10,400 million will be needed to expand Iran's natural gas export capacity in the next decade.

Kardor said that NIOC is now considering the possibility of issuing bonds to help finance the development of smaller oil fields. NIOC has been given a B+ rating and a positive outlook rating by Fitch. 'I think we may be doing bonds in early 2005,' said Kardor in an interview with MEED after delivering his speech.

'Iran is determined to keep its share of world energy consumption and play its role in stabilising the future international energy market,' he said. 'I would like to call on major IOCs, banks and investors to assist Iran in achieving these goals.'