Iran: Award without tender?

Majles Energy Commission spokesperson Emad Hosseini said the Ministry of Petroleum will be authorised under the new Petroleum Act to award oil and gas projects to contractors without tender formalities. Hosseini said the Ministry will have to award the projects based on the capabilities and qualifications of the contractors.

This new policy seems to have been devised as a result of sanctions that have effectively prevented international players from approaching Iranian energy projects.

It is not known whether Iranian contractors have the expertise to handle projects on their own. They may possess the basic knowledge to take care of tasks such as site preparation and the design of platform topsides, but they will need to involve foreign technology partners in some project aspects.

There is also no doubt that the new approach will pave the way for corruption in project awards.

For more news and expert analysis about Iran, please see Iran Strategic Focus.

© 2011 Menas Associates