The Iranian Petroleum & Energy Club

In the Name of God

Proceedings of Iranian Petroleum & Energy Club Congress

IPEC 2019 IRIB International Conference Center 8-9 October 2019 Book Title: Collection of Speeches at the 5th Petroleum and Energy Congress & Exhibition Organization Name: Iranian Petroleum and Energy Club Publisher: Institute of Rooyesh Rahbord Tosee Ariya Circulation: 1000 Volumes Pages Number: 372 Print Size: Vaziri Publication Date: First- Summer 2020 Editor: Hadi Khalili Dizaji Typography and Cover Design: Elaheh Lotfi

Organizer: The Iranian Petroleum & Energy Club

Introduction The Iranian Petroleum & Energy Club aims to promote efficiency and sustainable growth in Iranian energy sector by providing demand led policy advice based on professional experience and frontier research. As a professional and nonprofit association, we facilitate knowledge transfer to hundreds of energy executives and young entrepreneurs which help them better understand the financial and Management issues that shape the current energy environment in Iran. In collaboration with our network of professional executives, leading academics and field experts, we provide impartial and evidence-based policy recommendations for decision-makers in the energy sector; recommendations which have been successful in addressing some of the most entrenched challenges of Iranian energy sector. We follow out our missions by forming specific workgroups to perform needed researches and to provide specific and general consultancy to these sections and provide strategy, solutions and also to hold strategic meetings, conferences and congresses. We fit to evaluate the issues from a strategic view, observing and tracking changes and analyzing important and influential events in national, regional and global levels.

Council (Alphabetical Order) Mohammad lravani, Habibollah Bitaraf, Abdolhossein Samari, Rokneddin Javadi, Abbas Shaeri Moaghadam, Mohammad Ali Emadi, Ardeshir FathiNejad, Asghar Fakhrieh Kashan, Mohammad Malaki, Gholamreza Manouchehri, Seyed Mehdi Mir Moezi, Gholam Hossein Nozari.

Board of Director (Alphabetical Order) Mohammad Iravani, Abdolhossein Samari, Ahamd Davoodi, Seyed Abolhasan Seyed Khamooshi, Seyed Mohammad Sohofi, Bahman Masoudi, Seyed Mehdi Mir Moezi

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Organizing Partners

Vice- Presidency for Science and Technology, Presidency of the Islamic Republic of Iran Ministry of Petroleum Ministry of Energy National Iranian Oil Company Tavanir National Iranian Gas Company Renewable Energy and Energy Efficiency Organization of Iran National Petrochemical Company University of Tehran Sharif University of Technology Amirkabir University of Technology Petroleum University of Technology K.N.Toosi University of Technology Shahid Beheshti University Research Institute of Petroleum Industry Niroo Research Institute Iranian Petroleum Institute Iranian Society of Consulting Engineers Society of Iranian Petroleum Industry Equipment Manufacturers Tehran Chamber of Commerce Industries, Mines & Agriculture Association of Petroleum Industry Engineering & Construction Companies Iran Industrial Equipment Manufacturers Association Engineering & Construction Companies Association Iranian Oil, Gas and Petrochemical Products Exporters Union Association of Industrial Automation Companies

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Policy Council*

Seyed Mehdi Mir Moezi (Head of IPEC Congress & Exhibition Policy Council) Rokneddin Javadi (Ex Deputy Petroleum Minister for Supervision on Hydrocarbon Resources) Homayoun Haeri (Deputy Energy & Electricity Minister) Behzad Mohammadi (Deputy Petroleum Minister and Managing Director of National Petrochemical Company) Amir Hossein Zamani Nia (Deputy Petroleum Minister for Commerce and International Affairs) Mahmoud Nili Ahmadabadi (President, University of Tehran) Habibollah Bitaraf (Head of IPEC Supreme Council) Gholamreza Manouchehri (CEO, OIEC) Hossein Kazempour Ardabili (Iran’s OPEC Governor) Abbas Ali Abadi (CEO of MAPNA Group) Mohamad H. Panje Shahi (Chairman of Petroleum Engineering Institute of Tehran University) Sirous Talari (Chairman of the Board, Society of the Iranian Petroleum Industry Equipment Manufacturers) Behzad Hazrati (Chairman of the Board, Association of Oil, Gas and Petrochemical Engineering and Construction Companies) Amir Abbas Ekhteraee (Chairman of the Iran Industrial Equipment Manufacturers Association) Bahram Amini (President of the Iranian Society of Consulting Engineers)

* In this book, the individuals positions have been interpolated based on their job situation in the time period of Petroleum and Energy Congress holding in 2018 and the applied changes after the congress and at the time of book publication were not the criterion of their positions.

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Steering Committee

Mohammad Iravani (Iranian Petroleum and Energy Congress & Exhibition Secretary) Seyed Mehdi Mir Moezi (Head of IPEC Policy Council) Ahmad Davodi (IPEC Secretary) Abdolreza Foroughi Ali Kardor Hasan Montazer Torbati Jafar Rabiee Gholamreza Manouchehri Ardestani Seyed Abolhasan Seyed Khamooshi Reza Dehghan Seyed Amir Talebian Mohammad Mostafavi

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Panel Directors

Eight Million Barrels Per Day of Oil Production, A Necessity? Dream or Reality? Reza Dehghan, Deputy CEO, Development & Engineering of NIOC

Fiscal Regime in the Petroleum Sector of Iran Ali Kardor, EX Deputy Petroleum Minister & NIOC CEO

Financing Options for Development in Petroleum & Energy Sectors Jafar Rabiee, Persian Gulf Chemical Industry company CEO

Environmental Challenges, Progress or Setback Abdolreza Foroughi, Chairman, Iran Water Foundation

Startups and Ecosystem of Industry Innovation Mohammad Mostafavi, Managing Director, Oil Industry Investment Company

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Congress Topics

Main Theme and Topics Future Directions in Iran’s Petroleum and Electricity Business Environment; Focusing On the Role of Private Sector

OPEC and Non-OPEC Future Outlook New Requirements of Regional and International Gas Markets CSR in Oil Industry Eight Million bbl/d Oil Production; Necessity? Dream or Reality? Fiscal regime in the petroleum sector of Iran Environmental Challenges; Progress or Setback Knowledge-Based Companies and Startups; The Key to Oil Industry’s Future Evolution Review of “Article 44 of the Constitution’s Policies” Implementation and Outsourcing of State-Owned Sector Review the Boundaries of Government Tenure and Outsourcing Approach Restructuring and Reforming of the Ministry of Petroleum; International Experience and Studies Funding Development of Petroleum and Electricity Sectors; Stock Markets and Financial Securities

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Congress Sponsors

Platinum Sponsors

Pasargad Energy Hirbodan Development Company

Persianrad Group Energy Tadbir Holding

Dana Energy Pars Petrochemical Company

Bandar Emam Petrochemical Complex

Silver Sponsor

Mah Taab Gostar

Mellat Investment Bank

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Media Sponsors

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Index Preface ...... 3 Opening Ceremony ...... (Persian Section) 5 - 22 Seyed Mehdi Mir Moezi ...... (Persian Section) 7 Bijan Zanganeh ...... (Persian Section) 13

Keynote Speakers ...... (Persian Section) 23 - 72 Mohammad Reza Bahonar ...... (Persian Section) 25 Lars Nordrum ...... (English Section) 7 Mohammad Hosein Adeli ...... (Persian Section) 31 Gholamreza Manouchehri ...... (Persian Section) 49 Alireza Yazdi Zadeh ...... (Persian Section) 69

Eight Million Barrels Per Day of Oil Production, A Necessity? Dream or Reality? ...... (Persian Section) 73 - 122 Reza Dehghan ...... (Persian Section) 75 Seyed Saleh Hendi ...... (Persian Section) 76 Ali Akbar Vahidi AleAgha ...... (Persian Section) 77 Hasan Shokrolah Zadeh Behbahani ...... Persian Section) 79 Seyed Mahmood Mohaddes ...... (Persian Section) 81

Fiscal Regime in the Petroleum Sector of Iran ...... (Persian Section) 123 - 162 Ali Kardor ...... (Persian Section) 125 Seyed Mehdi Mir Moezi ...... Persian Section) 126 Mohammad Mehdi Rahmati ...... (Persian Section) 127 Alireza Saedi Sarikhanloo...... (Persian Section) 128 Mohammad Reza Kasiri ...... (Persian Section) 129

Financing Options for Development in Petroleum & Energy Sectors ...... (Persian Section) 163 - 200 Jafar Rabiee ...... (Persian Section) 165

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Asghar Fakhrieh Kashan ...... (Persian Section) 166 Seyed Rouhollah Hoseini Moghadam ...... (Persian Section) 167 Ali Ashraf Afkhami ...... (Persian Section) 168 Saeid Eslami Bidgoli ...... (Persian Section) 169

Environmental Challenges, Progress or Setback ...... (Persian Section) 201 - 240 Abdolreza Foroughi ...... (Persian Section) 203 Alireza Sadegh Abadi ...... (Persian Section) 204 Mohammad Taghi Jafarzadeh ...... (Persian Section) 205 Ahmadreza Lahijan Zadeh ...... (Persian Section) 206 Majid Makhdoum ...... (Persian Section) 207 Mohammad Reza Sedighi ...... (Persian Section) 208 Yousef Rashidi ...... (Persian Section) 209

Startups and Ecosystem of Industry Innovation ...... (Persian Section) 241 - 280 Mohammad Mostafavi ...... (Persian Section) 243 Saeid Mohammad Zadeh ...... (Persian Section) 244 Seyed Mohammd Sahebkar ...... (Persian Section) 245 Reza Zarnoukhi ...... (Persian Section) 246 Rashid Ghanei ...... (Persian Section) 247 Ali Sadeghi ...... (Persian Section) 248

Closing Ceremony ...... (Persian Section) 281 - 312 Hasan Montazer Torbati ...... (Persian Section) 283 Behzad Mohammadi ...... (Persian Section) 292 Mohammad Fazeli ...... (Persian Section) 299

Congress Statement ...... (English Section) 17 - 26 Mohammad Iravani ...... (English Section) 19 Mohammad Iravani ...... (Persian Section) 315

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Preface

Iran’s oil and power sectors have, in recent years, directly and indirectly made up a significant portion of the country’s national production and due to their nature and significance, they have been influenced by the international and national context more than any other economic sector. Recent changes in global markets structure, caused by oil and gas production from unconventional sources, Shales in specific, business conducts incompatible with international law and practice, the accelerated development of renewable energies and their consumer commodities and equipment, have posed serious threats to traditional markets and organizations such as OPEC. In the coming years, it is not unlikely that rivalry within OPEC will intensify and having excessive production capacity becomes vital for its core members, including Iran, and the issue of production from oil and gas resources will sooner or later be of particular importance. Although international sanctions have slowed the development of these sectors, especially the oil industry, domestic support can help reduce production barriers, increase productivity and boost other sectors of the economy. Organizing the structure of the relationship between the public and private sectors, including the adoption of laws and policies appropriate to economic activity by parliament and the government, regulate and monitor its implementation by independent entities, as well as the private sector’s commitment to the growth and development of business In the field of development, production, distribution and consumption of renewable and non- renewable energies, it will rejuvenate the prosperity of related activities and will increase national productivity. Also, given the dominant role of the government in managing the Iranian oil industry,

3 IPEC 2019 especially in the upstream sector, it is possible to increase the efficiency of the National Iranian Oil Company in exploration, development and production operations, as well as by supporting the establishment of an economic system. It is also possible to compete in this field with the support of Iranian E&P NGOs. In addition, given the presence of young, educated, creative and ready-to-work human resources in the country, supporting the establishment of knowledge-based companies and start-ups and guiding their activities in the direction of providing goods and services, the need for the oil and power sector as well as a more serious entry into the field of renewable energies can bring about an enormous and lasting support for business and technology to development in the country. The Fifth Iranian Petroleum and Energy Club Congress & Exhibition (IPEC 2019) provides an opportunity for discussion among all stakeholders and decision makers on these issues. Panels are structured in such a way to provide an appropriate framework for productive dialogue between business executives, experts and business stakeholders in these sectors. I hope that the results of these talks will pave the way for a new and effective way for the country’s energy sector, which is at one of its most critical times.

Seyed Mehdi Mir Moezi Head of IPEC`s Policy Council

4 Keynote Speakers

Tuesday 8.10.2019, 10:30 to 12:30

The 5th Iranian Petroleum & Energy Club Congress & Exhibition

LARS NORDRUM Norway’s Ambassador to Iran

Date of Birth:15.03.1975

EDUCATION “ASPIRANTKURSET”, Foreign Relation/Diplomacy, Diplomatic Academy, Ministry of Foreign Affairs, 8/2002 - 7/2004 Studies at the MBA-Program, Duke University - The Fuqua School of Business, 1/2001 - 7/2001

WORK EXPERIENCE • Ambassador, Royal Norwegian Embassy in Tehran, Iran • Project Manager/Chief Writer, Norwegian Ministry of Foreign Affairs, Oslo, Norway Headed the work on the Government’s new White Paper on Norwegian Foreign and Security Policy • Minister Counsellor - Deputy Head of Mission, Royal Norwegian Embassy in Islamabad, Pakistan • Senior Adviser, Norwegian Ministry of Foreign Affairs, Oslo, Norway, Middle East Desk • Senior Adviser, Norwegian Ministry of Foreign Affairs, Section for Security Policy and North America

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• First Secretary - Deputy Head of Mission, Royal Norwegian Embassy in Damascus, Syria • Second Secretary - Political Officer, Permanent Delegation of Norway to NATO, Brussels, Belgium, Afghanistan, Russia, non-proliferation, disarmament, arms-control • Associate Consultant, Bain & Company, Stockholm, Sweden, Management Consulting. Mainly worked on due diligence of start-ups in the telecom and biotech sectors. Also involved in cost cutting and business development projects in the food and media industries. (Worked with Bain &Co. in the summer of 2000 as Summer Intern.) • Second Lieutenant, Royal Norwegian Navy, Norway, Active Duty

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The Norwegian “Oil Fund”: Investing in the Future

Lars Nordrum

Norway, like Iran, owes much of its modern development to the discovery of petroleum. Whereas Iran was one of the first countries in the world to discover, Norway was one of the later with its major oil discovery in 1969. In my intervention here today I will do three things. First, I will briefly cover the history of oil in Norway. Second, I will delve into how we have invested the oil revenue in the Norwegian “Oil Fund”, formally known as The Norwegian Government Pension Fund Global. Or how we have transformed a limited resource such as oil into infinite assets for future generations. Third, I will briefly touch on Norwegian petroleum exports and Norwegian oil policy. The Norwegian Government Pension Fund is the largest sovereign wealth fund in the world and a high-profile investor. On Slide 1, you can see the current value of the Fund.

Slide 1: Current value Norwegian Pension Fund

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In 2017, the Fund’s value reached 1 trillion US dollars. This is more than twice our GDP. The main purpose of the Fund is to facilitate government savings to finance rising public pension expenditures. A sound long-term management of the Fund contributes to intergenerational equity, by allowing both current and future generations to benefit from the petroleum revenues.

Brief History of Oil in Norway: The discovery of oil the day before Christmas in 1969 has drastically changed my country. The first major finding, Ekofisk (Slide 2), was soon accompanied by more discoveries. In turn, this transformed Norway from a poor country into one of the world’s wealthiest.

Slide 2. History of Oil Discovery in Norway Norwegian production from the North Sea started in June 1971 and in the following years a number of major discoveries were made. Foreign companies dominated oil exploration in Norway in the initial phase, and were responsible for developing

10 The 5th Iranian Petroleum & Energy Club Congress & Exhibition the first oil and gas fields. However, the Norwegian Parliament held Norwegian ownership of our natural resources sacred. As a result, the government declared that the Norwegian State was the sole owner of the Norwegian continental shelf and its resources, and that only Parliament could hand out permits to foreign companies. In other words, the petroleum resources belong to the Norwegian people.

History of the Fund: The Government Pension Fund Global was established in 1990 with broad political consensus as an instrument for securing long term thoughtful use of Norway’s oil and gas revenues. The core tenet of the Fund is that the income should be invested globally through careful strategic management. Another core element of the Fund is its long investment horizon (Slide 3).

Slide3. History of the Fund Profits from oil and gas sales are taxed at a rate of 78%. All oil and gas revenues goes by law into the Fund. A budgetary rule, passed by Parliament in 2001, prevents government from spending more than the Fund’s expected annual return, which is between 3 and

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4%. In other words, zero money from oil and gas revenues is spent. We have been able to separate earnings from spending. Only the financial return from the Fund is tobe touched. That way, in theory and hopefully in practice, the Fund will last forever. In this way we are converting “black gold” (oil & gas) into “proper gold” (financial assets). We are turning limited physical resources into ever-lasting financial assets. This graph shows how the value of the Fund exceeds the remaining value of the resources on the Norwegian continental shelf. To further emphasize my point, in this graph we see on Slide 4 that in 2006 the value of the oil fund was smaller than the estimated value of oil and gas reserves. However, this has changed. In 2018, the value of the fund was larger than the remaining oil reserves. This poses the question whether Norway should continue to be described as an “oil nation”, or whether it would be more appropriate to call us an “asset management nation”.

Slide 4. Growing value of the Fund From early on, one of the main goals of Norwegian petroleum policy was to be cautious. With the large oil discoveries, the Norwegian Government was presented with a dilemma: It wanted to secure the wealth extracted from the numerous oil

12 The 5th Iranian Petroleum & Energy Club Congress & Exhibition fields without stoking inflation in the economy. For that reason, Norwegian officials clearly envisaged the idea of investing capital worldwide rather than in the Norwegian economy. As you can see on the map, the Fund has invested in 73 different countries.

Slide 5. Investments policy across the globe To reduce risk, we have spread our financial assets across countries, sectors and companies. This way, we are mitigating the volatility stemming from fluctuating oil prices, unrest in financial markets, changes in interest rates and real estate bubbles. The Fund has invested globally in international equities (69%), fixed income (28%) and real estate (3%).

Governance Model: An overriding goal for all investments is complete transparency. One example is the live update of the fund’s market value, voting records are published one day after general assemblies, the Central Bank publishes annual publications of complete

13 IPEC 2019 holding lists. As mentioned, oil revenues do not contribute to the budget. Petroleum revenues and return on existing investments go into the Fund. The Fund’s expected annual return, which is between 3 and 4 %, is then used to finance the state budget.

Exports of oil and gas Norway exports most of our energy to the EU, which includes 90 % of our oil and almost all of our natural gas. Norway supplies about 25% of the demand for gas in the EU. Diversification of suppliers is an important consideration for EU countries. In later years we have seen how petroleum suppliers have used their leverage over their consumers by reducing the flow of oil & gas for political reasons. In this context it is important to note that Norwegian Petroleum Policy is to have no policy. This is somewhat over-simplified. But what I mean to say is that we refrain from mixing politics and business. Norwegian Oil and Gas sales are based on pure commercial interests. By eliminating political considerations in our oil and gas policy, we believe we are a much more predictable supplier.

Environmental considerations Environmental and climate considerations are also an integral part of the Fund’s policy. For that reason, the Fund invests in renewable energy sources such as wind, hydro and solar power. For example, from 2020 the Fund will double its investments in renewables and invest up to USD 12 billion in that sector. Furthermore, Norwegian oil and gas companies are realizing that they need to adapt to a greener future. These companies are therefore investing heavily in renewable technologies. They no longer see themselves as oil & gas companies, but rather as energy companies. Statoil recently changed its name for this very reason and is now

14 The 5th Iranian Petroleum & Energy Club Congress & Exhibition called Equinor. The switch from fossil to renewable energy will not come over night, but the change is rapid. In Norway every second new car is electric and there are enormous investments in offshore wind.

Conclusion In conclusion, my country has been very fortunate in discovering oil and gas. Norway as we know it was built on this immense wealth. Since the Norwegian Government Pension Fund Global was established in 1990, we have aimed at converting the limited petroleum resources into ever-lasting financial assets. It has given us tremendous opportunities and if managed carefully it will not only benefit my generation but last for generations to come and far beyond the closing of the last well in the North Sea. I hope these perspectives from a small country in the far north can have some value also for Iran which in almost every way has different parameters to consider when determining its petroleum policy. Something we are made all too aware of under current circumstances.

CongressKeynote SpeakersStatement

The 5th Iranian Petroleum & Energy Club Congress & Exhibition

Mohammad Iravani Chairman and CEO of Dana Energy

Personal Information Date of Birth: 1967

Work Experience and Designation He is an experienced and successful leader with over 30 years of outstanding performance with a solid formal education in Industrial Engineering. He had run a family business in heavy industry for several years, which lead him to follow his ambition in oil & gas upstream industry. Mohammad Iravani founded Dana Energy in 2000 and built this company into one of the most successful E&P and Oilfield Services businesses in Iran. He is currently the Chairman and CEO of Dana Energy, and Member of the Board of Iran Energy club, Iranian Drilling Companies Associations (IDA), and Iran Oil and Gas Federation.

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Mohammad Iravani

We are pleased that the Iranian Petroleum and Energy Club Congress & Exhibition has become increasingly welcomed by activists, experts and influencers in both petroleum and energy, and is now in it`s 5th year. The important point is that despite the absence of state-owned corporations in Congress due to the petroleum ministry’s order to save money and reduce in the number of international speakers, the number of participants have increased by 60 percent over the previous period. The increase in the number of registrants, along with their attendance at panels, especially in the second day, testifies to the success of the Congress. We hope that the issues raised in Congress will be followed up at specialized panels, monthly meetings, and club publications, so disseminate the results to interested stakeholders.

Summary of Opening, Closing, and Meetings lectures Opening Seyed Mehdi Mir Moezi (Head of IPEC Policy Council) Emphasizing the nonprofit, nongovernmental and non-political aspects of the Iranian Petroleum and Energy Club’s activities and pursuing the challenges of the oil and energy industry Emphasizing the future of business landscape in Iranian oil and energy industries with focus on private sector as it was the main theme of the Congress The changing of oil`s political geography with the emergence of booming resources, new technologies and emerging powers in the industry

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Proposal to use existing potential and internal facilities in light of the problems imposed by sanctions, including: Issuance of Quality License by the Oil Association, five to 10 years support for E&P companies, outsourcing of O&M activities, serious approach to financial markets given the high liquidity in the community

Bijan Zanganeh (Minister of Petroleum) Oil stimulates other engineering and non-engineering sectors of the economy The most important private sector activities in the petroleum industry: all types of contracting activities, direct investment in the petroleum industry (petrochemicals, refining and distribution, liquefaction of gas, ...), production of equipment and systems needed by the petroleum & oil industries, optimization of energy consumption, supporting Iranian E&P companies, trading of petroleum and gas products, supporting knowledge-based companies and startups The essential requirements of the oil industry for growth and development: empowering and reforming the management structure, enhancing professional and technological capability, financing and equipping resources through financial markets Finding innovative ways to grow companies and raise funds instead of using the National Development Fund Support startups and accelerators and knowledge base companies in petroleum industry

Keynote Speakers Mohammadreza Bahonar (Ex Member of the IRI Parliament) We mainly seek to be a good seller of oil while the energy consumption in the country is much more than oil sales income. The value of Iranian oil specialists working worldwide today is no less than our oil

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exports. Governance and regulation are the missing link of the private sector`s useful presence in the Iranian economy.

Lars Nordrum (The Ambassador of Norway) Norway has the largest oil fund in the world, worth twice the GDP of Norway. In 2018, the value of the fund has exceeded the value of Norway’s underground oil reserves. Fund investments are intended to convert black gold into property gold; therefore, it has been used throughout the world in long-term investments. It is invested in 73 countries and 50 types of currencies, with combination of 69% in the financial sector, 3% in real estate and 28% in fixed income sectors. Preventing the effect of political issues, Norway’s oil and gas sales are fully commercialized and have made Norway a reliable and predictable supplier. Norway will double the investment in renewable energy next year. Oil companies have changed their essence to energy companies (Statoil to Equinor).

Mohammad Hossein Adeli (Head of the Board, Iranian Associaton for Energy Economics) Gas is booming to play a key role as an alternative to oil. Gas market growth in 2018 was five percent; almost double the average growth. LNG is a new phenomenon in the gas market. US competes with Russia in Europe over LNG.

Gholamreza Manuchehri (CEO, OIEC) Major energy trends: regulations on reducing emissions, renewable energy, growing gas

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and oil demand, developing new and unusual oil & gas resources and new energy hubs Seven upcoming trends in the energy sector: diversity in upstream companies & contracting models, development of renewable energy infrastructures, crude oil to petrochemical/refinery products, energy efficiency improvement and reduction of energy intensity, development of supporting industries and equipment manufacturing, development of startups and knowledge base companies, development of petroleum products’ trade with neighboring countries

Alireza Yazdizadeh (Strategic Planning & Control VP of MAPNA Group) Domestic political changes and approaches, are highly damaging private sector. In the war of trade/commerce and industry (which dates back to the pre-1979 revolution, especially when oil revenues were high) trade has always imposed itself on the industry, and this historical record has left no incentive for the manufacturer.

Eight Million Barrels Per Day Oil Production; A Necessity? Dream or Reality? The main purpose of this issue is to emphasize the necessity of paying attention to the future while making decisions, and the choice of eight million barrels’ production has been raised just to stimulate thoughts. Deciding on the appropriate production capacity/goal is a matter that requires a variety of economical, technical, environmental considerations with a view to the future. Final decisions should be made without prejudice to any of the views and approaches, in a transboundary point of view. Considering the dramatic developments and changes in energy trends and the increase in share of other types of energy and its growth, it is important to think seriously about the rate of production, the amount of oil production and the increase of its

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production capacity. The behavior of major oil companies in the world indicates their readiness for new conditions. Resources needed for Iran’s oil industry transformation: $ 200-250 billion from domestic or international sources, New technologies to reduce costs and increase recycling, Competent and qualitative manpower, Presence of domestic and international companies

Fiscal Regime in the Petroleum Sector of Iran Structural reforms are needed in various sectors of government financial relations with oil and other sectors such as the National Development Fund. In the transition period, the active and current fields should be managed with the current (income) model, but development plans should be operationalized by the investor through the (proposed) fund to create an improved financial structure and Provide both the opportunity and the competitive environment for companies and the private sector. In future contracts, with the use of long-term prospects (20 years), the profit-sharing structure can be easily implemented. The proposed framework of the National Iranian Oil Company’s financial interaction model with the government should encompass financial-contractual regime, governance and regulatory, transparency and legal requirements. At present, the relationship between oil and government is revenue-driven. In successful businesses and worldwide best practices, this relationship is profit- oriented, so companies are more inclined to use or create new technologies and improve productivity. There are two problems with the current fiscal regime; the share of government is very high; oil prices are very variable. Companies must have an independent board

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of directors to make long-term decisions (such as Aramco and Statoil) It is suggested that a non-governmental and non-profit corporation be established as a National Oil Investment Fund and that its shares be listed on the stock market.

Financing Options for Development in Petroleum & Energy Sectors Challenges in financing include sanctions, international regulations and various risks in different sectors Despite the variety of available tools, unfortunately we are unaware of them. Our managers are unfamiliar with variety of domestic international financing tools, and the current approach to the capital market is not due to understanding the market, but rather to the lockdown of public finance. Some large petrochemical companies have secured the funds they need by the use of guaranteeing their subsidiaries’ shares to issue bonds or transferring uncompleted plans to producing companies with available resources. There are many challenges today to finance and the cost of Rial resources is high; There is no access to foreign investment or leverage use of funds from Iranian companies located abroad. Therefore, it is better not to define a new project, but rather to plan for overseas financial and monetary markets.

Environmental Challenges, Progress or Setback The environment encompasses industry, nature, economy, culture and politics. We (Iran) dropped 36 steps in the Environmental Performance Index from 2006 to 2012. Despite all activities, our environmental status has not improved. Environmental concerns need to be turned into a program.

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The situation of oil flares is inadequate; no serious action has been taken since the revolution and plans have not yet been achieved. Pain must be properly diagnosed befor treatment. According to standards and indicators such as AQI, the problem of air pollution after recent years’ corrections, is not related to fuel quality but to the quality of the combustion process in cars. Not only we need some laws, but some current available rules and regulations are not implemented at all. Some laws do not allow the Ministry of Petroleum to create incentives and remedies to improve fuel consumption By planning, we have achieved the stated goals in a resisting economy to reduce emissions. Currently less than five of our power plants use mazut. Fortunately, since 2013 we have persistently resisted against drying out the Hoor.

Startups and Ecosystem of Industry Innovation Startups have changed the structure of economics and culture. The Ministry of Petroleum is looking for an idea rather than a solution. Many things like Big Data, IoT, etc. ... may not be a problem for the petroleum industry right now, but it is likely to be in the near future. Investing in Startup is different from other ones. It is Investment on the future. The most important feature of VCs is that, in addition to financial and corporate services, they are as a mentor for companies Based on innovation and competitiveness indicators, we have problems in establishing a systematic relationship and forming a value chain. The startup / knowledge-based ecosystem in the country has not yet been pathologically reviewed and modified. The capacity of the accelerators will be used for pathology and design of the Rey Park.