After reaching a preliminary deal with the West on its nuclear program, Iran is working on attracting international oil companies to help rebuild its oil industry. The removal of sanctions is allowing Iran to reconnect with the rest of the world, and as the home of the fourth-largest reserves of oil in the world, Iran's oil industry will be central to its economic revitalization. At a news conference in Tehran on February 9, 2014, Mehdi Hosseini, an official at Iran's oil ministry, said that the Iranian government is putting together oil contracts that will be "in line" with international law and will also offer more favorable terms to oil companies than can be found in neighboring Iraq.
International sanctions have cut off investment to Iran's oil and gas fields in recent years, and an oil embargo from much of the world cut into Iran's oil exports. Desperate to boost production, Iran has promised to woo oil companies with better deals than they can find in Iraq, which largely favor the national government. In Iraq oil companies sign up for a pre-determined fixed rate of return for any oil produced, rather than a percentage of oil sales which can be achieved through a production-sharing agreement, an arrangement preferred by the oil majors. Kurdistan, to the dismay of the central government in Baghdad, has gone its own way and offered very favorable deals to oil companies, succeeding in attracting the interest of ExxonMobil and Total, among others.
According to Bloomberg, Hosseini said that Iran will provide a preview of its new oil framework at a conference in Tehran on February 22, and will release the full details in June or July. Iran will need an estimated $150 billion in private investment over the next five years to build up its oil and gas sector.