Rules and Regualtions Prevailing on Foreign Investment in Upstream Oil Industry Projects of Iran, with Particular Reference to the Buy-Back Facilitations Method

Given the substantial role of oil and gas industry, particularly the contribution of upstream development projects in Iran economy, the need for attracting and promoting foreign investments on its upstream projects besides insuring adequate protection of the capital flowed specially through Buy-Back formula, is indisputably vital. On that account, the article attempts to outline the relevant prevailing rules and regulations in order to assess Iran’s legal position in promoting and protecting foreign investments attracted in upstream sector of its oil and gas industry. The Article strives to mark and analyze such rules and regulations and attempts to shed light on the legal system governing this highly strategic industry. In doing so, it will duly examine the upstream Exploration and Development Service Contract (“Buy-Back”), with particular emphasis on to the rules and regulations applicable to Iran’s Third Generation of the Buy-Back contract, Fifth Five Year Development Plan of the country (2011) as well as the reformed Petroleum Act of2011.