The Political Economy of the IRGC’s involvement in the Iranian Oil and Gas Industry: A Critical Analysis

MSc Political Science (Political Economy)

Thesis Research Project: The Political Economy of Energy

University of Amsterdam, Graduate School of Social Sciences

5th June 2020

Author: Hamed Saidi Supervisor: Dr. M. P. (Mehdi) Amineh (1806679) Second reader: Dr. S. (Said) Rezaeiejan

[This page is intentionally left blank]

2 Table of Contents

Table of Contents ...... 3 Abstract ...... 6 Acknowledgments ...... 7 Maps ...... 8 List of Figures and Tables ...... 10 List of Abbreviations ...... 11 I: RESEARCH DESIGN ...... 13 1.1. Introduction ...... 13 1.2. Literature Review ...... 16 1.3. Theoretical framework ...... 19 1.3.1. State corporatism and the role of military forces ...... 20 1.3.2. The neo-mercantilist developmentalist state ...... 21 1.3.3. Hypotheses ...... 23 1.3.4. Argumentation: economic and political mechanisms ...... 24 1.3.4.1. and the IRGC’s involvement in the economy ...... 24 1.3.4.2. Factionalization as a catalyst political factor ...... 27 1.4. Research method ...... 29 1.5. Organization of the thesis ...... 32 II. TRANSFORMATION OF THE ISLAMIC REPUBLIC FROM STATE CORPORATISM INTO THE NEO-MERCANTILIST DEVELOPMENTALIST STATE ...... 33 2.1. Introduction ...... 33 2.2. State Corporatism and the role of the IRGC during 1979-1989 ...... 34 2.2.1. State corporatism in post-revolutionary ...... 34 2.2.2. The origin and position of the IRGC in the consolidation of the Islamic Republic ...... 36 2.2.3. The crisis of state corporatism and the necessity of economic adjustment ...... 37 2.3. The emergence of neo-mercantilist developmentalist state and the IRGC’s involvement in the economy ...... 38 2.3.1. The nature of the Iranian neo-mercantilist developmentalist state ...... 39 2.3.2. Privatization of state-owned enterprises ...... 45 2.3.3. Privatization and the involvement of parastatal and military institutions ...... 49 2.4. Conclusion ...... 51

3 III. POSITION AND DEVELOPMENT OF THE OIL AND GAS INDUSTRY WITHIN THE POLITICAL ECONOMY OF IR ...... 53 3.1. Introduction ...... 53 3.2. The structure of the within the Iranian economy ...... 54 3.2.1. Oil and gas reserves ...... 54 3.2.2. Share of oil and gas revenues in Iran’s political economy ...... 55 3.2.3. Ownership and governance of the sector under state corporatism ...... 59 3.3. Energy industry under neo-mercantilist developmentalist state of Iran ...... 60 3.3.1. Necessarily of transformation in the energy sector ...... 60 3.3.2. Introducing Buyback Contracts (BBC) and foreign ...... 61 3.3.3. NIOC’s subsidiaries and their ties with political factions and elites ...... 63 3.3.4. Contractors and influence of political factions and elites in the energy sector ...... 65 3.4. Conclusion ...... 68 IV. THE IRGC’S INVOLVEMENT IN THE IRANIAN OIL AND GAS INDUSTRY ...... 71 4.1. Introduction ...... 71 4.2. The development of the IRGC’s involvement in the Iranian economy ...... 71 4.2.1. Background of the IRGC’s entry into Iran’s post-war economy ...... 72 4.3. The IRGC’s involvement in the oil and gas industry ...... 74 4.3.1. Khatam al-Anbia’s activities in oil, gas, areas ...... 75 4.3.2. The IRGC’s involvement in the energy sector during the presidential terms ...... 83 4.4. Conclusion ...... 86 V. Conclusion ...... 88 Bibliography ...... 92 Books ...... 92 Peer-reviewed journal articles ...... 95 Online recourses ...... 98 Primary recourses ...... 99 Media, newspaper, weekly journals ...... 113 Appendixes ...... 114 I. Largest prived reserve holders of crude oil and ...... 114

4 [This page is intentionally left blank]

5 Abstract The prominence involvement of the Islamic Revolutionary Guard Corps (IRGC) in the Iranian economy, especially in the oil and gas industry, has drawn particular attention in the political as well as academic sphere. This thesis examines the economic and political factors involved in the presence of the IRGC in the energy sector relating to the historical development of the Iranian political economy in the post-revolutionary period. Specifically, the purpose is to map how the transformation of the political structure of the Islamic Republic, the execution of the neoliberal economic policies in the energy sector, and the rivalry among political factions together generate a condition under which the IRGC as a military institution has become a powerful domestic player in, among others, the oil and gas industry. Underneath this triangulation complex is the shift of the Islamic Republic from state corporatism into the neo-mercantilist developmentalist state by which the state pursued a top-down strategy of economic liberalization and, simultaneously, maintain its control over the economy. The state involved the IRGC as one of the most well-organized and reliable instruments to have strict control over the reshaping of the national economy at which the IRGC operates as the long-arm of the state in this process. At the political level, political factions within the Islamic Republic played as a mediator factor in the augmenting/diminution of this involvement in each presidential term.

Applying neo-Gramscian approach and process-tracing method, the thesis inquires into evidence to illuminate the causal mechanisms among changing the structure of the state, the impact of the economic liberalization, and the role of political factions from the 1979 Revolution until nowadays, which caused the enter of the military entity in the economy. The study concludes by debating the understanding of the role of military forces in the economy, not as an isolated entity from the entire structure of the political-economic system, but rather in relation to the interaction between different forces within non- hegemonic societies in the Global South by focusing on the particular historical structure.

Keywords: The Islamic Republic of Iran, neo-mercantilist developmentalist state, economic liberalization, oil and gas industry, IRGC.

6 Acknowledgments

Conducting this research coincided with the outbreak of the pandemic COVID-19-crisis, which had pros and cons for my circumstance. On the one hand, the world was facing a deep crisis, and of course, it continues yet, that it has paralyzed even the most advanced capitalist countries and has taken several hundred thousand lives so far, which requires a different world. On the other hand, although I worried about the situation around me and had to stay in quarantine, I took care of my health very well and used, however, this period to invest my energy and time entirely to write this thesis.

As well, it was for me an instructive and successful period in which I received constructive and challenged feedback from my supervisor dr. Mehdi Amineh. I would like to thank him for his genuine commitment and guidance. Although we had sometimes hard discussions about the content of the thesis and other issues, it has ended always with the reciprocal understanding of the disagreement. Also, my second reader, dr. Said Rezaeiejan, deserves my thanks for taking the time to read and review my thesis.

I am happy and satisfied with my contribution to explaining and illuminating the complexity of social phenomena to make the way easier toward the improvement of human being life. With the completion of this thesis, the door of this study period has finally closed behind me and a new door giving access to a challenging, yet enthusiastic perspective has opened in place.

***

7 Maps Map I. & South Caspian Oil & Gas Map

Source: IOGN (2020).

Map II. Iran’s oil and gas fields and infrastructure map

Source: Fanack (2012).

8 Map III. Iran’s map

Source: IOGN (2020).

Map IV. Iran’s Natural Gas Map

Source: IOGN (2020).

9 List of Figures and Tables

Figure 1.1 Causal mechanisms behind the evolution of the IRGC from a military institution into a dominant player in the economy, especially in the oil and gas industry.

Figure 1.2 Tracing causal mechanisms.

Figure 1.3 Causal mechanisms that caused the evolution of the IRGC as a military institution into a dominant contractor in the oil and gas industry.

Figure 2.1 Total Iranian between 1993 and 2017.

Figure 2.2 Divested value and number of State-Owned Enterprises' share during Presidential terms,1991-2019.

Figure 2.3 The Divested value of State-Owned Enterprises' share, 1991-2019.

Figure 2.4. The comparative value of the transfer of shares of state-owned companies before and after the notification of the general policies of Article 44 of the Constitution.

Figure 3.1 World proved crude oil reserves.

Figure 3.2 The Iranian oil production, export, and consumption during 1973-2017.

Figure 3.3 Iran's gas production, consumption, and export during 1978-2017.

Figure 3.4 Share of oil in total Iranian government’s revenues and total export value during 1979-2017.

Figure 3.5 Share of the total export of Iran and petroleum export during 1979-2017.

Figure 3.6 Total FDI in Iran, including Buy-Back in oil and gas sectors during 1997-2017.

Figure 4.1 The awarded contracts to the IRGC’s affiliated companies in the area of oil, gas, and petrochemical (I) per each presidential term and (2) per sub-eras (1996-2019).

Figure 4.2 The value and ratio of awarded contracts to the IRGC's associated companies in the oil, gas, and petrochemical field in each presidential term between 2000 and 2019).

Figure 4.3 The annual value of awarded contracts to the IRGC's associated companies in the oil, gas, and petrochemical area between 2000 and 2019.

Table 2.1 The nature of buyers, value, and share of the transferred state-owned enterprises, 2001-2014.

Table 3.1 NIOC's subsidiaries in the Iranian energy industry.

Table 4.1 The awarded contracts to the IRGC’s affiliated companies in the area of oil, gas, and petrochemical (I) per each presidential term and (2) per sub-eras (1996-2019).

10 List of Abbreviations

BP: British Petroleum

CBI:

DW: Deutsche Welle

E&P: Exploration and Production

EIA: Energy Information Administration

FDI: Foreign Direct Investment

FY:

ICANA: Islamic Consultative Assembly

ILNA: Iranian Labour News Agency

IMF: International Monetary Fund

IOC: International Oil Companies

IOEC: Iranian Offshore Engineering and Company

IPO: The Iranian Privatization Organization

IPRC: Islamic Parliament Research Center

IR: The Islamic Republic

IRGC: The Islamic Revolutionary Guards Corps

MoP: Ministry of Petroleum

NICO: Company

NIGC: The National Iranian Gas Company

NIOC: National Iranian Oil Company

NIOOC: National Iranian Offshore Oil company

NIORDC: The National Iranian Oil Refining and Distribution Company

NPC: The National Petrochemical Company

OIEC: Oil Industries Engineering and Construction

OPEC: Organization of the Petroleum Exporting Countries

PE: The political economy

PEDC: Petro-Iran Development Company

11 PEDC: and Development Company

POGC: and Gas Company

SOEs: The State-Owned Enterprises

Tcf: Trillion cubic feet

TcM: Trillion cubic meters

US.EIA: Energy Information Administration

12 I: RESEARCH DESIGN

1.1. Introduction Soon after the victory of , as a former cadre of the Islamic Revolutionary Guards Corps (IRGC), in the presidential election in June 2005, a $3 billion contract for the development of phases 15 and 16 of South Pars Gas Field was awarded to Khatam al-Anbia in 2006 (, 2007). Parallel to the international sanctions, many other no-bid billion-dollar contracts were given to Khatam al-Anbia (Donya-e Eqtesad, 2010a). The prominence economic activities of the IRGC have gradually reinforced by which Khatam al-Anbia as the IRGC’s affiliated company has become one of the dominant domestic contractors in the oil and gas industry. With the introduction of it as one of the competent Iranian companies in the field of exploration and production (E&P) in 2016 by Bijan Zanganeh, the Iranian Minister of Petroleum (MoP), Khatam Al-Anbia was named as one of Iran's future oil giants (ISNA, 2016). The prominence involvement of the IRGC in the economy, especially in the oil and gas industry, accompanied by the various internal and external reactions in the political and academic area. At the internal level, Akbar Turkan, the Senior Advisor to President , said that Khatam al-Anbia is "very strong" and the government is not able to compete with its unreliable and breach of contract in the implementation of projects (DW, 2014). Moreover, at the level of international affairs, the United States imposed sanctions against involved Iranian companies “for providing financial support to Khatam al-Anbia”. The U.S. Treasury Department announced in its statement that recently the Iranian MoP awarded Khatam al-Anbia, the IRGC’s economic arm, ten projects in the oil and petrochemical industry worth about $22 billion (US. DT, 2019). Simultaneously with these developments, several questions have raised to illuminate and understand the significant presence of the IRGC in various social, political, and economic spheres, particularly in the oil and gas industry as the main source of government revenues.

This issue took attention within the academic sphere to figure out and perceive the increasing involvement and position of the IRGC in Iranian socio-political and economic fields. As a result, several studies describe the multilayered function and activities of the IRGC in the post-revolution period (Alfoneh, 2007; Alfoneh, 2010; Wehrey et.al., 2009; Ostovar, 2009; Hourcade, 2009; Safshekan & Sabet, 2010; Hen-Tov & Gonzalez, 2011; Rizvi, 2012; Forozan, 2013; Sinkaya, 2016; Coville, 2017). Although some of these scholars describe the IRGC’s activities in the energy sector limitedly, there is a clear academic gap in a comprehensive and systematic investigation in the IRGC’s involvement in the Iranian oil and gas industry and analyzing its engagement in relation with a broader context of the political and economic structure of Islamic Republic. The description of the multilayered character of the IRGC provides solely what we observe as an outcome, which does not explain the main factors behind these developments to understand the dynamism of the socio-political and economic structure of the system. Dynamism contains here continuous changing and the interrelation between the action of various forces within a society, such as state, market, social classes, political groups, elites, military,

13 socio-political, and economic institutions, which cause various social outcomes. The forces as units of analysis are not isolated from the entire system, but all of the unites interrelated and shapes certain outcomes. To sum up, social phenomena should be explained as manifestations of various forces within a society.

Socio-politically relevant, given the fact that energy resources – particularly oil and gas - are located in the Middle East and the Caspian region, and the competition between energy consumers increased dramatically, it is of great importance to analyze the powerful actors at the national scale in resource- rich countries. Since the 1970s, as result of using the term ‘rentier state’ by Mahdavi (1970), “the relationship between oil and politics in the developing countries has been explored by mainly political scientists who have focused on the mediating role of oil revenues” (Jafari, 2019, 25). The term ‘rentier state’ has been applied to explain the relationship between oil revenues and the form of state in the developing countries by which the state becomes autonomy in financing from the society and social classes. So, it critically matters to explain which factors play a significant role in the IRGC’s involvement in energy resources within the broader context of the nature of the Islamic Republic which is a rentier-state. The issue of oil and the role of the state in controlling natural resources and its relationship with the society cannot be understood, I contend, without reveal links between the form of the state and the dominant political as a capitalist society.

The political economy (PE) refers here to analyze the formation of each particular society at the macro-system level, which is the reciprocal relationship between state, market, and community in a certain society and at a historical juncture (Stilwell, 2012, 13). That means that the interaction among the triangulation of (I) the form of the state (a liberal state or an authoritarian/centralized state), (II) arrangement of the economy, and (III) the class structure of society together generates certain outcomes. This perspective helps us to understand the political and economic formation and permanent alteration of a particular society that shapes and constrain our options and helps to reveal the forces that change the context within a certain mode of production. The mode of production includes the force of production (the productive of society) and the social relations of production (social arrangement by the pattern or configuration of social classes engaged in the production process) (Hunt & Lautzenheiser, 2011, 4; Cox, 1988, 12). When we speak of production, it “is not only a particular production. Rather, it is always a certain social body, a social subject, which is active in a greater or sparser totality of branches of production” (Marx, 1993 [1857], 18). From the view of critical theory, the contemporary capitalist political economy as a particular mode of production is generally characterized by four sets of arrangements: “market-oriented commodity production; private ownership of the means of production; a large segment of the population that can not exist unless it sells it labor power in the market; and individualistic, acquisitive, maximizing behavior by most individuals within the economic system” (Hunt & Lautzenheiser, 2011, 4). However, the pattern of the historical development of capitalism in all countries worldwide is not the same. However, in developing countries

14 in the Global South, such as Iran, the structure of the state and the market is different compared to the advanced capitalist countries. “In centralized state-society complexes, civil society, based on social classes and forces, especially a business [... is] underdeveloped, or too weak to act independently of state power” (Amineh & Guang, 2018, 11). Then, it is of significant matter to illustrate how the political economy of the Islamic Republic works and what has happened that IRGC has gained access to the oil and gas industry. This thesis provides an understanding of the function of the IRGC within a resource- rich country, analyzing the reciprocal relationship among the state and society, and the necessity of the IRGC for the Islamic Republic and the political factions to have strict control over the recourses as well as economic development. The findings, analysis, and critical approach of this thesis contribute to illuminate the mutual relations between the involved forces within the structure of the political economy of the Islamic Republic.

Hence, the main objective of this thesis is to analyze the political-economic mechanisms/factors behind the IRGC’s involvement in the oil and gas industry considering the broader context of the dynamics of Iran’s political economy. To achieve this objective, this thesis attempts, in the first step, to provide a picture of the structure of the Iranian political economy in the post-revolutionary era from a helicopter view, which helps to understand the main factors behind the IRGC’s involvement in the economy, especially the oil and gas industry. Next, it aims to describe the size and scope of the IRGC’s involvement in this industry as the spinal cord of Iran’s economy. Subsequently, it will be focused on analyzing the evolution of the IRGC over time into a determinant economic actor in the energy sector. This development must be considered as an outcome of a set of causes, which are political and economic factors. The causal mechanisms behind this metamorphosis are determinant for understanding the key role of the IRGC as a military institution in Iran’s energy resources. So, this thesis poses one core question:

Why Iran’s Islamic Revolutionary Guards Corps (IRGC) has become a dominant actor in the Iranian oil and gas industry?

In light of that the objective of my thesis, the main question is an explanatory question which attempts to investigate the political-economic mechanisms behind the prominence of the IRGC’s involvement. When we speak of mechanism, it contains a set of factors or a component of a system that plays a determinant role in producing a certain outcome. In other words, mechanism is “a set of hypotheses that could be the explanation for some social phenomenon (Hedstroem & Swedberg, 1998, 25). In our case, the outcome is the involvement of the IRGC in the economy. To answer adequately the main question, several sub-questions are formulated:

1) What are the political-economic mechanisms involved in the IRGC’s involvement in the economy?

15 2) What is the position of the oil and gas industry in Iran’s political economy and which factors led to the IRGC’s involvement in this industry? 3) To what extent the IRGC has become a central player in the Iranian oil and gas industry?

To understand the political-economic mechanisms behind the increasing engagement of the IRGC in Iran’s oil and gas industry, it will be focused on the post-revolutionary period, from 1979 until 2019. Focusing on this timeframe is in light of the fact that the IRGC was established in the direct aftermath of the in 1979 to defend and consolidate the Islamic Republic of Iran. The IRGC has gradually, parallel to political-economic transformations, become a leading actor in the Iranian economy, especially in the oil and gas industry. Analyzing the patterns behind the IRGC’s economic power requires an investigation into the historical development of this military organization during the last four decades. Nevertheless, this historical process will be divided into two timeframes. First, the rise of the IRGC will be shorty demonstrated during 1979-1989. Then, it will be analyzed which political-economic change during 1989-2019 led to the IRGC’s shift into a central economic actor.

1.2.Literature Review The literature on the position and function of military forces in the Iranian political and economic fields, particularly the role of the IRGC in the post-revolutionary era, discusses mainly in relation to the structure of the political system. The increasing involvement of the IRGC in the economy led to a consensus among some scholars who mainly analyze from a political perspective by the framework of the militarization of the economy. Alfoneh (2007) pointed out that the clergy and the IRGC are two complementary centers of power in the Islamic Republic. He argues that although the official and original duty of IRGC was to “safeguard the revolution,” but it has gradually become a dominant actor in Iranian politics, which lead to its infiltration in “all spheres of life in Iran.” That has been “transforming Iran into a military dictatorship” (idem, p.16). Alfoneh does not explain the relationship between the IRGC’s evolution and the structure of the Iranian political economy.

Forozan (2013) applies the theory of ‘civil-military relations’ and ‘institutional’ studies to analyze power relations in post-revolutionary Iran. This analysis focused on the rise to power of the IRGC in post-Khomeini Iran (since 1989), particularly after the victory of Ahmadinejad in the presidential election in 2005 that led to the reinforcement of the IRGC’s presence in the oil and gas industry. He used the concept of praetorianism to explain the weakness of political institutions of countries (like Iran) compared to those of its military entities. Forozan argues that this issue is a condition that creates fertile ground for the military’s takeover of the political system. Applying the concept of the ‘garrison state’, he pointed out that the increasing power of the IRGC from a military entity to a leading political and economic player is a consequence of, among others, domestic political tension within the context of Iran’s factionalized political process. In addition, the scope of the IRGC’s expansion into political and economic sphere “was the outgrowth of its responses to internal crisis and perceived external threats

16 in the context of Iran’s ongoing elite struggle for power” (Forozan, 2013, 1). Although he exerted the term ‘factionalism’ as a factor to explain the IRGC’s involvement in the economy, it contains a statist view in the sense of interrelations of political and economic forces, and the necessity of historical development as a consequence of internal dynamism of capitalist development in Iran. Factionalization of the political system may influence the involvement of some interest groups and/or military institutions in the socio-political and economic fields, but a dynamic explanation - which considers the reciprocal impact of all involved factors - required linking between the political system and the structure of the economy. Therefore, Forozan’s work does not help the reader adequately to understand the political-economic mechanisms involved in this development.

Some scholars applied the term ‘militarization of economy’ to explain the increasing presence of the IRGC in the economy. From this approach, Alfoneh (22010) attempted to demonstrate how the IRGC has benefited from the privatization of the state-owned enterprises (SOE) during Ahmadinejad’s presidency. According to hem, purchasing the SOEs by the IRGC and its subsidiary companies, among other the Khatam al-Anbia Construction Headquarter, “show the militarization rather than the privatization of Iran’s economy” (p.1). Furthermore, Safshekan and Sabet (2015) analyze the prominence of the IRGC in the economic and the political arena, especially related to the Ahmadinejad administration, as “obvious examples of the militarization of a hitherto civilian and clerical government” (p.553). Following, the Iranian political structure has been analyzed as a “praetorian” state whereby the increasing involvement of the IRGC’s companies in the economy was interpreted as transformation of the political system “from its unique clerical model toward a type of military dictatorship to the centralization of the economy” (Hen-Tov & Gonzalez, 2011, 45).

In contrast to this analysis and viewpoint, Harris (2013) states that the involvement of the IRGC in the economy has to be seen as a “subcontractor state”, not as a “praetorian monolith” (p.45). That means that the alteration of the Iranian political economy since 1989 into the implementation of the neoliberal economic policies by all political factions can better explain the prominence engagement of parastatal and military entities in the economy. As he points out, the substantial presence of the IRGC “needs to be situated within a larger analytical field” (idem, p.46). In relation to the broader context of the political economy of Iran, “[t]he economic prominence of the IRGC and parastatal organizations is not a sign of their militaristic takeover of the state.” Rather, it is the outcome of the historical socio-political and economic development of the Islamic Republic. In addition to economic mechanisms, the role of political factions in this process has to be considered as “political infighting between elites who use economic policy as a battleground for factional struggles.” Harris argues correctly that “the rise of the subcontractor state, [...] should not be confused with the logic of militarism. Instead, the subcontractor state is an outcome of the way in which politics and society shaped the form of capitalism that has taken root in the Islamic Republic” (idem, p. 46-47).

17 Hence, it is important to illuminate the necessity of the IRGC for the certain ruling class and interest groups within the political economy of the Islamic Republic. Regarding the structure of political- economic character of some Middle Eastern states, among others Iran, Dorraj (2017) and Ehteshami and Murphy (1996) applied the concept of populism and corporatism to explain how populist regimes came in power, utilized a corporatist strategy to govern, and how they have transformed over time. This perspective considers the state as an organic authoritarian institution above the society in order to unify the socio-political community, to achieve the common needs of the whole society by the central role of the state (Klaren & Bossert, 1986, 27). Moreover, Schimtter (1979) defines state corporatism as a form of authoritarian practice of the state into the society, which results in the creation of dominated and dependent interest organizations. Generally, corporatist states are militarily strong, oppressors, and interventionists in economic and social life as well as in inter-group interest mediation (Dorraj, 2017). This approach does not, however, explain the dynamism of the transformation of state corporatism to a new form, and what is the role of military forces in the newly established system. The understanding of the origin of the IRGC in the wake of Iran’s Revolution in 1979 and its evolution into a multilayered actor in Iran’s economy requires (a) understanding the dynamics of the political economy of the Islamic Republic over time, and (b) the economical and political factors that caused the involvement of the IRGC and other parastatal entities in the economy.

On the historical development of capitalism in Iran since the 1979 Revolution, the study of Behdad (2000), from populism to economic liberalism: the Iranian predicament, sheds light on the evolution of the post-revolutionary economic crisis and divides this period into three phases: (I) revolutionary disruptions (1978-80), (II) Islamic populism (1981-1989), and (III) liberalism of the post-Khomeini era (since 1989). Moreover, Nomani and Behdad (2006) divided the post-revolutionary Iran into two periods: the first period (1979-1989) was accompanied by the rise of revolutionary uprisings, disruption of the process of capital accumulation and capitalist relations of production, and the implementation of populist state-oriented policies. The second period started with the death of Khomeini in 1989. This is a period in which the orientation of the Islamic Republic and its policies shifted towards economic reconstruction and the revival and consolidation of capitalist economic relations and institutions (p. 26- 27). Behdad (2000) underlines and demonstrates that after a decade of economic liberalization, the conglomerate network of parastatal and military foundations and “their affiliated enterprises have benefited from special privileges and have reaped extremely attractive profits over the years.” (p.12). Despite the rapid implementation of economic liberalization since 1989, among others the privatization policies, the state, and its affiliated entities were still the dominant players in the economic field.

Consequently, this study focuses on the main political-economic factors involved in the increasing role of the IRGC in the oil and gas industry in the context of the political economy in post-revolutionary Iran. To achieve that, the Critical Theory (neo-Gramscian approach of Robert W. Cox) will be applied, which provides a suitable view to understanding the complexities of the Iranian political and economic

18 structure during a set of historical processes. Although the neo-Gramscian approach is known as a theory of International Relations, its departing point is, however, analyzing the involved factors on the national scale. Therefore, the critical theory of Cox will be employed as a theoretical model to understand the complexities of the case.

1.3. Theoretical framework The establishment of the IRGC and its evolution is the outcome of various objective socio-political and economic conditions in a historical process. With departing from this viewpoint, ‘historical materialism’ as one of the main dimensions of critical theory offers us a dynamic and historical approach to explore and understand the necessity and function of the IRGC within the Islamic Republic. Historical materialism contains, in Gramsci’s thinking, that the reciprocal relationship between production relation and ethnopolitical sphere shape a state-society complex as constituent entities of an entire socio- economic formation and for exploring the particular historical forms taken by these complex (Cox, 1981, 134). Hence, the involvement the IRGC in the economy has to be considered as the outcome of two historical structures in the Iranian post-revolutionary period in which the structure of the state- society complex, which is the relation between the political power structure, the structure of the market, and the structure of social classes generated several conditions under which the expansion of the IRGC’s function has become a necessity for the survival of the ruling political-economic structure. This process is divided into two eras to examine and analyze the evolvement of the IRGC: (1) The establishment of state corporatism in which the IRGC was a suppression instrument of eliminating social conflicts and consolidate the Islamic Republic (1979-1989), and the transformation of the regime toward (2) a particular form of the neo-mercantilist developmentalist state (since 1989) that attempted to reshape the economy by the implementation of economic liberalization through a top-down strategy. These two successive historical structures have to be identified by a set of features and involved forces.

Referring to Cox (1981), within each historical structure interact three categories of forces: (a) Material capabilities which include technological and organizational capabilities, and in their accumulated forms as natural resources, (b) ideas, and (c) institutions (economic, political, and military institutions, a means of stabilizing and perpetuating a particular order, and reflect the power relations prevailing at their point of origin) (p.135). To understand which political and economic factors lead to establishing the IRGC as a military institution and its evolution into an influential economic actor, it will be looked at the composition of forces and interactions of the categories within each historical structure.

The method of historical structure and its features is applied to three levels of analysis: (1) the social forces (involved social movements, social classes and strata, political groups, the degree of socio- economic development, and organizations of the production process); (2) forms of state (the structure of the political power, as liberal and autocratic states); and (3) world order (the dominant economic and

19 political power in a certain historical time. These levels are not separate from each other, but they interrelated. It means that, for instance, changes in the organization of the production process generate new social forces which, in turn, bring about changes in the structure of the state (Cox, 1981, 136).

Based on this preliminary discussion, two forms of historical structure will be described whereby the IRGC founded as a result of the emerging of state corporatism and has been evolved to a leading economic actor as the consequence of emerging the neo-mercantilist developmentalist state.

1.3.1. State corporatism and the role of military forces State corporatism is the main concept to elucidate the structure of the political economy of the Islamic Republic in the first period of post-revolutionary order (1979-1989). Corporatism is a concept by which the dynamism (continuous activity/change and interrelation of actors/forces) of a certain form of state- society is analyzed. The most dynamic and multidimensional definition of state corporatism has been developed by Robbert W. Cox. With departing from Cox’s viewpoint, at the level of social forces, state corporatism is the outcome of a social crisis of hegemony in a certain society. “Under state corporatism, the [newly established] state imposes authoritatively upon industry and organization of formal representation for employers and workers intended to maintain order, to regulate working conditions, to promote social harmony, and to eliminate conflict” (Cox, 1989, 80-81). So, state corporatism is, in the sense of Gramsci’s description, a product of non-hegemonic societies, which means that in a historical moment in which the conflict between antagonistic social forces outbreak and no dominant class has been able to achieve hegemony, a “passive revolution” is a response to this social crisis.

Passive revolution is a condition where the ruling bourgeois class is unable to maintain its control over all other social classes, and the new progressive social class (workers) as a counter-hegemonic force are not capable of achieving their own hegemony over the society. Therefore, passive revolution is “an attempt to introduce aspects of revolutionary change while maintaining a balance of social forces in which those favoring restoration of the old order remains firmly entrenched.” (Cox, 1983, 166). In other words, it is a “revolution” without a “revolution”. In this process, the leading group takes over the power and gains control over the state’s apparatus and mainly employs coercion in seeking to reform the economy in some extend, while the older mode of production remains largely, which manifested in a form of state repression and strong intervention in the economy (Roberts, 2015, 1666). Hence, these conditions induced “a ‘molecular’ social transformation which takes place as it were beneath the surface of society, in situations where the progressive class cannot advance openly (Gramsci, 1971, 194).

Using these suitable concepts helps us to explain the emergence of the IRGC in the direct aftermath of the establishing of the Islamic Republic as the outcome of a non-hegemonic society whereby neither then-establishing capitalist class nor revolutionary working-class could achieve their hegemony over the Iranian society. In the context of this circumstance, Rohullah Khomeini, as the man of destiny and as leader of the populist forces of Political Islam emerged and imposed itself as the solution of the social

20 crisis. The IRGC stemmed from, and vitally necessary for establishing the corporatist state to “freeze conflict without resolving the issue between the antagonistic social forces” (idem, p.192). In short, the emergence of the IRGC has to be analyzed in the context the state corporatism in Iran, which is the outcome of the passive revolution in 1979.

Nevertheless, the state corporatism in the Middle East struggles with various challenges during its existence. At the level of social forces, the national economic forces, as material capabilities, do not “contain sufficient effective demand to become a dynamic force and the existence of an excess supply of labor given no incentive to stimulate greater efficiency on the part of investors”. At the level of the state’s form, “the power holders in the state apparatus [are not able, due to the lack of hegemonic ideas and institutions] to mobilize society so that it will produce a surplus under state auspices” (Cox, 1989, 231). In the context of Iran’s political economy, these factors led to the political and economic impasse of state corporatism. However, it does not mean that state corporatism would be disappeared as a result of these challenges. State corporatism has, rather, led to its metamorphosis to a new form as the neo- mercantilist developmentalist state to adapt and adjust some economic and (to some extend) political reforms in response to the requirement of capitalist development, and, consequently, capital accumulation and regime survival. The development and establishing of state power during a certain timeframe allow the political elite to take various initiatives from above to induce economic reforms, which leads to the transformation of the political economy into a new stage of its life. This historical process did not change the social structure of capital accumulation fundamentally. The new structure has been changed by the new form of the state (Cox, 1989, 266). Within the new hierarchical arrangement, the military institutions are involved with economic development. The concept of ‘the neo-mercantilist developmentalist state’ is used to identify the new stadium of the Islamic Republic.

1.3.2. The neo-mercantilist developmentalist state Using the neo-mercantilist developmentalist state provides us to understand the structure of the political economy of Iran in the second period of the post-revolutionary order (since 1989). In the first place, the neo-mercantilist developmentalist state “seeks to gain control over its instruments necessary to shape the national economy, and in second place, it is developmentalist because it wants to use these instruments to achieve continuous growth and structural change” (Cox, 1989, 231). This tendency and dynamism of the state lie in the structure of the state-society which contains that (a) the state does not possess enough capacity to reshape society, and (b) social forces and private sectors are not strong and coherent enough to organize itself. The new form of the state and its closed and well-organized entities remain as a central actor in the transformation of the economy and the society. This reaction of the neo- mercantilist developmentalist state is the result of “the impact of foreign economic penetration and the gradual inclusion of a country within the world capitalist economy and the nature of the local response by social and political forces to this impact” (idem, p.234). Hence in this process, the state determines several duties for itself, such as “combinations of stricter control over access by foreign capital,

21 increases in the rents extracted from resource exports, support for the national capital, expansion of the state sector, and increased foreign borrowing for investment according to state-determined plans” (idem, p.232). The neo-mercantilist developmentalist state has two important features: (1) the implementation of the economic liberalization form above and (2) the lack of unity within the state.

Firstly, to achieve economic development, the transformation goes with the execution of neoliberal economic policies, which is the dominant strategy of the world economy, known as neoliberalism. Harvey (2005) initially defines the phenomenon of neoliberalism as a theory of political-economic practices that indicates the power relationship between capital and labor in favor of the former. This policy is implemented through mostly “deregulation, privatization, and withdrawal of the state from many areas of social provision” (idem, p.2-3). This form of reconstruction of the global structure was a policy to make all social relations and economic activities subordinated to the necessities of the world economy and the free market sphere. In this way, the nature of capitalism, which is the maximization of profit and the accumulation of capital, will dominate all aspects of human life without the slightest restriction, except with social resistance. It starts with the privatization of the SOEs to absorb foreign capital to supplement the shortage of national capacities in order to stimulate investment and production. To execute these kinds of reforms within non-hegemonic societies in developing countries, “the bureaucracy became increasingly reliant on the abilities of the commercial bourgeoisie to provide the appearance of economic success (imports of consumer goods) and the ingredient of finance capital (foreign investment)“ (Ehteshami & Murphy, 1996, 759). The strategical economic liberalization entails several risks and opportunities. The uneven capitalist development has led to the unbalancing of the social, political, and economic conditions in the country during a historical process. The fact that the reshaping (liberalization) of the national economy resulted in the reshaping of social forces (including both the structure of the economy and social classes), the confident support of the military forces as the most well-organized and its direct link to the state is crucial to create and maintain the ‘order’ in favor of economic development and regime survival. This means that the dramatic impact of liberalization of the economy has unsphered that the power of military forces does not erose, in contrast, militias and paramilitaries wield substantial power. This aspect does not mean that the economy would be militarized, in contrast, the state needs loyal organized institutions to meet the requirement of economic development outside the scope of the state and, at the same time, to supply a strong control of the state over the economic development process. From this perspective, it is important to look at the economic reforms in Iran since 1989 and the expanding process of the IRGC into a leading actor in the various eras of the economy.

Secondly, at the level of the state’s form, one type of the neo-mercantilist developmentalist state is cartel-state. “In a situation where not internal social hegemony has become established, [...] the cartel- state would continue the path of dependent development” (Cox, 1989, 234). Parallel to the implementation of the liberalization of the economy, the state suffers from its significant lack of unity.

22 Political instability within the state appears in different political factions which attempts to take a different position regarding the way of reforms to benefit most, and in the final analysis, to maintain and consolidate its power positions. The state’s cadres and prominent leaders “may be torn apart into rival factions competing for state’s resources, giving more scope for private capitalists, who favor and secure more liberal economic policies” (ibid). This situation creates a fertile ground for an intensive rival power position within the state, which “may lead to unwise investment, to the entrenchment of rival power positions within the state, and to corruption” (idem, p. 244). The rivalry between factions coincident with their attempts to secure the survival of the regime. This aspect helps us to analyze the power position of different political factions within the Islamic Republic and the maneuver of military forces within this internal cleft.

Hence, the transformation of the economy would be resisted through some factions of the bureaucratic bourgeoisie who believed that privatization of economy and power-sharing with private enterprises (include foreign economic actors) would lead to power loss, which, in turn, can threaten the existence of the state power. “For the sake of self-preservation - and to resist pressures to alter their economic policies - they used the means available to them, the security forces, to reimpose their authority (Ehteshami & Murphy, 1996, 764). The lack of unity within the state and the continuity of lack of state’s hegemony over the society are the political expressions of a stalled non-hegemonic society. This requires still the military forces which have to go with the transformation of the economy to secure the ‘order’ within the society.

1.3.3. Hypotheses • H1: The top-down economic liberalization strategy by the Iranian neo-mercantilist developmentalist state caused fundamental conditions under which the involvement of the IRGC as the most well-organized and coherent institution was for the Islamic Republic critically important to have strict control over the reshaping of the economy, and to satisfy the implementation of economic liberalization at which the IRGC operates as the long-arm of the state in this process. • H1-0: The top-down strategy of economic liberalization by the Iranian neo-mercantilist developmentalist state did not cause fundamental conditions under which the involvement of the IRGC as the most well-organized and coherent institution was for the Islamic Republic critically important to have strict control over the reshaping of the economy, and to satisfy the implementation of economic liberalization at which the IRGC operates as the long-arm of the state in this process.

The first hypothesis contains the economic mechanisms behind the IRGC’s involvement in the economy. As discussed above, the lack of unity of the state is an aspect of the neo-mercantilist developmentalist state. Therefore, economic mechanisms are influenced by the role of political

23 factions. Political factions, as explained below, had an impact on the degree of the IRGC’s engagement in the economy, especially in the oil and gas industry. Therefore, our complimentary hypothesis is:

• H2: Intensive rivalry between political factions augment/diminish the involvement of the IRGC in the economy, especially the oil and gas industry. • H2-0: Intensive rivalry between political factions did not augment/diminish the involvement of the IRGC in the economy, especially the oil and gas industry.

1.3.4. Argumentation: economic and political mechanisms Based on the discussed theory in the previous section, I shall put forward how the IRGC has evolved with the transformation of the political economy (PE) of Iran in the post-revolution era. Looking at the development of the Iranian post-revolutionary PE after the Iran- War (1980-1989), the IRGC has parallel transferred to making intensive ties with, among other, various economic fields. This evolution can be adequately glossed by analyzing the tendencies and dynamics of the transformation of the Iranian PE from state corporatism to the neo-mercantilist developmentalist state. Both economic and political mechanisms caused the IRGC’s involvement in the economy.

1.3.4.1. Economic liberalization and the IRGC’s involvement in the economy The arguments behind the first hypothesis are based on the economic mechanisms which drive from the top-down strategy of economic liberalization by the Islamic Republic as a form of the neo-mercantilist developmentalist state. The accumulation of political and economic crises and many other contradictions that the Islamic Republic during the first decade of its life has confronted associated with the state-led economy. The most important challenge for the regime was getting economic growth going (encouraging maximization of profit and capital accumulation) and maintaining its control over the society, including the economy to survive the regime. These challenges led the regime to adapt structural economic adjustment under the auspices of the International Monetary Fund (IMF) and the . Therefore, "non-dependence on the West" and "self-sufficiency," which were the main slogans of the Islamic Republic’s leaders for dozen years, gave way to the economic liberalization in the framework of "Washington Consensus". The mechanisms of the neoliberal economic policies based on deregulation on the scope of capital performance, privatization of SOEs and social services, and, the limitation of the government in the economy. The recommendation of these international financial institutions to applying their neoliberal policies centered on three pillars: (1) price stability and real exchange rate devaluations; (2) relying on the market mechanism by turning prices into a real indicator of resource scarcity, and relying on the private sector to drive growth; (3) opening of the national economy to international trade and export-led growth (Cammett, et al., 2015, 274). In other words, the logic of neo-liberalism is that by “getting the prices right” and “getting the state out of the way”, productivity and profitability will increase, production expands, consumption growth limits, import fall,

24 exports rise. As a result of these developments, they claimed, the economy grows, employment increases, and, in particular, the shortage of foreign currency disappears (Nomani & Behdad, 2006, 90). The purpose of the economic liberalism policy is to change the power relationship between capital and labor, which the reconstruction of the distribution of income by increasing the share of capital accumulation (profit) and reducing the share of workers (wage).

In the context of the Iranian PE, in a condition under which the destruction of capitalist production relations, capital accumulation, and economic development, which induced by the 1979 Revolution and war with Iraq (1980-1989), led to a depth economic and political crisis. In this circumstance, “the bourgeoisie took its battle to the political arena and raised the banner of economic liberalism, demanding denationalization (privatization) of industries and deregulation of the market” (Behdad, 2000, 12). Therefore, Iran’s postwar political leader, under the leadership of the Pragmatist faction, led by President Akbar Hashemi Rafsanjani (1989-1997), moved toward significant economic liberalization based on a state-led economic reconstruction. Specifically, adapting the neoliberal economic policies in Iran included three essential components: (1) unification of the exchange rate and floating the currency, the rial; (2) decontrolling prices and eliminating subsidies; and (3) the privatization of state-owned enterprises (SOEs) (idem, p. 14). This strategy has been implemented by successive Iranian governments from 1989 until nowadays.

Within our model of analysis, there will be sought how the implementation of the economic liberalization generated some appropriate conditions for the IRGC’s involvement in the economy. Stems from the fact that private sectors in the post-revolutionary period were weakened and marginalized, the involvement of the IRGC and many other parastatal foundations in the economy was vitally important for the Islamic Republic, to have strong control over the reshaping of the economy. This was also an opportunity for parastatal entities to benefit the state initiative of privatization. Regarding the privatization of SOEs as an important mechanism, “for governments to reduce their role in the economy and expand the play of market forces, the state itself must be strengthened” (Haggard & Kaufman, 1992, 25), which is being a critical challenge for the Islamic Republic. To encourage the economic liberalization policies through privatization of SOEs and, at the same time, to intervene continuously in the economy, the state has to be autonomic in relation to public sectors. To fulfill this requirement, “governments need to carve institutions out of the state apparatus that is unconstrained by such linkages” (Harris, 2013, 48). As a consequence of these trends, for instance, after decades of implementation of economic liberalization in the 1990s, the state and parastatal institutions ( and military forces) were still the main player in the economy (Behdad & Nomani, 2008, 99).

25 So, there are two important economic mechanisms/factors involved in the IRGC’s presence in the economy: (1) privatization of SOEs and (2) foundation of domestic contractors to satisfy the attraction of foreign investment.

(1) The privatization of State-Owned Enterprises (SOEs) provides a legal way for parastatal entities and the IRGC’s affiliated companies to become one of the most winners of this policy. For instance, during the first period of the privatization process, half of the 331 divested companies went to parastatal foundations (Muradi, 2005, 52). The privatization of SOEs is an important economic factor for the increasing engagement of the IRGC as a dominant actor in the economy, which led gradually - and it is theoretically and logically expected - to its shift into the oil and gas industry. This strategy has been followed by all of the Iranian government since 1989. As Harris (2013) emphasized, “the popular consensus among political factions within the Islamic Republic, no matter where they lie on the ideological spectrum, is that massive and rapid privatization of state-owned assets is needed as an economic panacea for the country’s woes” (Harris, 2013, 46). Nevertheless, this process is, however, influenced by different political factions, as a catalyst factor, when they control the government’s institutions (see 1.1.4.2). That is, given the fact that each faction represents its own patronage network - mainly for mobilization of social groups and classes to take over and maintain the power - “[w]ith government control being key to business opportunities, profit-seekers curry favor with politicians and decision-makers give contracts to “their” entrepreneurs” (Bjorvatn & Selvik, 2008, 12-13) (see more in the next section, 1.3.4.2). (2) Foundation of domestic contractors in the oil and gas industry: The founding of domestic contractors in the era of the petroleum sector by the Islamic Republic was the other factor by which the IRGC’s subsidiary companies expanded their activities and has become one of the most dominant players in the oil, gas, and petrochemical sector. The arguments are the following. Given the fact that the political economy of Iran is critically dependent on petroleum revenues, in line with the economic liberalization policy, the Iranian government introduced the “buyback” contracts model as a mechanism for attracting foreign investment into the Iranian energy sector (see 3.3.2). To pull on foreign investment, during Rafsanjani’s tenure, mani (semi)private affiliated companies have been established and reached its peak during Khatami’s tenure to satisfy the needs of attracting international oil companies in the petroleum sector (Maloney, 2015, 394). This trend is better understood “as being the continuation of a trend toward oil sector development by quasi-state player, with the progressive rise in importance of a new set of domestic contractors, most notably companies associated with the IRGC” (Yong, 2013, 12). This trend is, I assume, a requirement of the Iranian economy to integrate into the world economy, alongside the close control of the state in the sector by established (semi)private contractors and the IRGC’s associated companies as long- arms of the state. This process is indeed influenced by the intervention of the political factions as a mediator factor.

26 1.3.4.2. Factionalization as a catalyst political factor As a political mechanism, factionalization of the state contributes an important role, but as a catalyst factor, in the involvement of the IRGC in the economy, among others the oil and gas industry. As some scholars stress, factionalism is one of the most characters of post-revolutionary Iran and dominating the political economy of Iran since the 1979 Revolution (Amuzegar, 2009; Gheissari & Nasr, 2006; Farzanegan, Bjorvatn & Schneider, 2011; Bjorvatn & Selvik, 2008). According to the definition of Beller and Belloni (1978), a faction is a “relatively organized group that exists within the context of some other group and which (as a political faction) competes with rivals for power advantages within the larger group of which it is a part” (p.419). In our approach, as before mentioned, factionalism is a product of a non-hegemonic society in which different component of the state-cartel (factions) take up positions within the state to capture shares of the rents and other revenues flowing through the state undermines consistency in the disposition of state-controlled resources (Cox, 1988, 243). Given the fact that Iran as a resource-rich country is a rentier economy and the form of the state is highly factionalized, some studies examined the role of the factionalism in rens-seeking in Iran. In other words, “in Iran, politics also determined how, to whom, and over what networks economic resources flowed during the process of restructuring domestic firms and markets” (Harris, 2013, 48).

(3) Factionlization of the state. Regarding the second hypothesis, the intensive rivalry between political factions catalyzes and reinforced the involvement of the IRGC in the economy, especially the oil and gas industry. This is the outcome of the lack of unity within the state by which the prominence involvement of the IRGC is among others resulted in competition between political factions and elites who use economic policy as a battleground for factional struggles (Harris, 2013, 47). The study of Farzanegan, Bjorvatn, and Schneider (2011) on ‘oil revenues, political power, and economic growth in Iran: theory and evidence’ confirmed that “higher levels of balance of power in the political system and bolder competition among different political groups in a factionalized political system like Iran reduce the positive effects of oil wealth on growth.” This means, in terms of the rivalry between political factions to capture shares of oil rents, that “when oil revenues are “high”, the rent-seeking argument dominates, implying that increased power balance is negative for overall growth” (p. 32). Moreover, Bjorvatn and Selvik (2008) in their study on ‘destructive competition: Factionalism and rent-seeking in Iran’ concluded that “the reallocation of power will lead to a reallocation of factors of production in favor of the stronger group” (p.18). Consequently, as Maloney (2015) points out, “in conjuncture with their financial muscle has come political influence; by virtue of intricate personal and institutional ties with the government, the bonyads have become pivotal actors in the enduring rivalry among the ideologically oriented factions within the clerical establishment” (p. 148).

Given that the significant involvement of the IRGC in the economy started since 1989, to analyze the role of the political factions as a catalyst factor for augmenting/diminution of the IRGC’s

27 involvement in the economy, the second period of post-revolutionary Iran (since 1989) will be divided over four sub-periods: (I) Pragmatic conservatives faction, under the leadership of Hashemi Rafsanjani (1989-1997), (II) Reformist faction during the ’s tenure (1997-2005), (III) Neo- conservative faction, known as Principalist (Osulgarayan) during the presidency of Mahmood Ahmadinejad (i.e. alliance of Builders of Islamic Iran, the IRGC and forces) (2005-2013), (IV) and Moderation faction (E’tedaal), which was established as a result of an alliance of ‘Pragmatic conservatives’ and ‘Reformists’ under the leadership of Hassan Rouhani (since 2013).

Figure 1.1 Causal mechanisms involved in the evolution of the IRGC from a military institution into a dominant player in the economy, especially in the oil and gas industry.

Nature of the neo-mercantilist •The state imposes developmentalist state in Iran authoritatively upon industry, (since 1989) workforce, the society to Consequences maintain order, to regulate working conditions, to promote • Top-down strategy of the reconstruction of the economy social harmony, and to •Increasing the (economic liberalization) eliminate conflict involvement of the •Using/establishing military •Continuity of the state's control parastatal and forces to freezing social over the economy military entities in conflicts within the soicety. • Lack of unity (factionalization) the economy within the state

State Corporatism (1979-1989) Transformation of the State’s form

Causal Mechanisms X Y (Outcome) Main CNs Mediator

Economic Liberalization

The IRGC’s involvement

in the economy

ilitary Privatization of SOEs zation of of zation

as a m a as Reinforcement/undermin

the the state

institution ing of the IRGC's Factionli IRGC Foundation of domestic engagement in the oil contractors in the oil and and gas industry gas industry

28 1.4. Research method This research is based on the intensive study of a single case which is the evolution of IRGC as a military institution into a domestic dominant player in Iran’s key energy resources. The emerging of the IRGC as a determinant contractor in the oil and gas industry can be considered as an extreme case. Studying an extreme case, as Seawright and Gerring (2008) declare, is suitable for an exploratory analysis that is looking for possible causes of a certain outcome. In this case, our specific research is being conducted into possible causes of the evolution of the IRGC into an economic player in the Iranian economy, particularly the oil and gas industry.

Given that the evolution of the IRG is the product of a chain of political-economic developments during a historical process, and the applied critical theory has a historical approach to analyzing social realities, the applying of the ‘process-tracing method’ is the most suitable analytical method. The process-tracing method refers to a style of analysis used to reconstruct a causal process that occurred in a single case (Gerrin, 2007, 216). George and Bennett (2005) define the process tracing as “a procedure for identifying steps in a causal process [– the causal chain and causal mechanism –] leading to the outcome of a given dependent variable of a particular case in a particular historical context” (p.176).

This analysis aims to open up the black box of causality to study more directly the causal mechanism whereby various political-economic factors/mechanisms contribute to producing the IRG as a powerful economic actor. Here, a mechanism contains “a set of hypotheses that could be the explanation for some social phenomenon (Hedstroem & Swedberg, 1998, 25). The formulated hypotheses of this thesis are the starting point to explain the mechanisms that may have caused the IRGC’s expansion to an economic player. To examine whether the posed hypotheses as a set of causal mechanisms exist in reality, it is necessary to be operationalized in terms of developing predicted empirical observables (see Figure 1.3).

Figure 1.2 Tracing causal mechanisms

Source: Beach and Pedersen (2013)

For investigating and tracing causal mechanisms (see Figure 1.2), as argued in the previous section (1.3.4), I examined how the top-down strategy of economic liberalization by the Islamic Republic led to the involvement of the IRGC in the economy. To achieve that, I examined the probabilistic and deterministic factors (Mahoney & Goertz, 2006). Specifically, I examined (a1) the privatization of the SOEs by which the IRGC and other parastatal foundations got access to the transferred share of SOEs and benefit the most from that strategy. Next, I looked for (a2) the foundation of various domestic

29 contractors in the oil and gas industry, among other the IRGC’s affiliated companies, as a strategy of the neo-mercantilist developmentalist state to maintain its control over the energy sector. Finally, I examined how (a3) political factions as a mediator factor influenced (Y) the involvement of the IRGC in the economy. Here, a1 and a2 are necessary conditions (determinant) for occurring Y, and a3 is a supplementary condition that guarantees the augmenting/diminution of Y. In this process, a1 and a2 are the necessary causes of Y. In our case, the presence of the IRGC in the economy (Y) necessarily implies the presence of the top-down strategy of economic liberalization (a1 and a2). Moreover, (a3) factionalization of the state is also a necessary condition, but not determinant, for the augmenting/diminution of occurring Y (see also Trampusch & Palier, 2016).

To examine these causal mechanisms, I sought and collected various evidence to expose the underlying factors involved in this process. Doing that, I took advantage of a large variety of primary and as well as secondary sources. Under primary sources, appropriated sources were selected from a wide variety of publications in the based on relevance, which includes news and data from the Web site of Khatam al-Anbia (the IRGC’s affiliated company), National Iranian Oil Company (NIOC), the Iranian Privatization Organization (IPO), Central Bank of Iran (CBI), Islamic Parliament Research Center (IPRC), official Persian newspapers and news agencies, official Web sites of Iranian governments’ institutions and leader. Because of the sensitivity of the thesis’ subject and the limitation of primary sources in terms of the IRGC’s activities in Iran, a set of secondary sources were selected from relevant books and peer review articles in the English and Persian languages. Regarding the data collection, it is necessary to note that there is a lack of complete and transparent information about the scope and size of the IRGC’s property and the real awarded contracts to the IRGC’s affiliated companies. Nevertheless, I employ attentive description, examination of qualitative and quantitative evidence in historical sequence in connection with posed hypotheses premises to investigate causal relationships, which strengthens the internal validity of the research.

30 Figure 1.3 Causal mechanisms that caused the evolution of the IRGC as a military institution into a dominant contractor in the oil and gas industry

. Theoretical/ hypothesized causal mechanism (CM) Part 1 of CM Part 2 of CM Part 3 CM Part 4 CM Outcome

Political Mechanisms: Rafsanjani's Khatami's Ahmadinejad's Rouhani's factionalization goverment goverment goverment goverment (a3) (Y) The involvement of Top-down the IRGC’s affiliated Economic Economic Economic Economic companies in the strategy of the liberalization => liberalization => liberalization => liberalization neo-mercantilist economy developmentalis t state in Iran (X-1) Privatization Privatization of Privatization of Privatization of of SOEs SOEs SOEs SOEs Economic mechanisms (X-1) Founding of Founding of Founding of Founding of Prominence of the (a1 and a2) contractors in contractors in contractors in contractors in energy sector energy sector energy sector energy sector IRGC's engagement in the oil and gas industry

IRGC's involvement in Reinfocement of Continuity of IRGC's enter in economy by its the IRGC in IRGC in energy energy sector subsidiaries energy sector sector

Collect evidence

31 1.5. Organization of the thesis This thesis consists of four chapters that follow the Research Design as the introduction of the thesis, with each chapter presents and discusses different aspects of the advanced arguments regarding the involvement of the IRGC in the Iranian oil and gas industry. Chapter II is devoted to answering the sub- question one aims to present and analyze the political economy of Iran from a helicopter view to explain the causal relations between the structure of the state and the IRGC’s involvement in the economy. In this chapter, I shall first present a brief overview of state corporatism and the role of the IRGC in the first period of the post-revolutionary era (1979-1989). Then, it will be put forward how the Islamic Republic transformed into a neo-mercantilist developmentalist state and implemented a top-down strategy of economic liberalization since 1989 whereby the IRGC and other parastatal foundations were involved in the economy.

Chapter III investigates the second sub-question to focusing on the position of the petroleum sector in the Iranian political economy, including energy resources, the share of oil and gas revenues, and ownership and governance of the energy sector. The second part of the chapter examines the transition of the energy sector into the liberalization model to develop this industry, the influence of political factions and elites in this process, foundation of domestic contractors for purpose of the attracting foreign investment, and emerging the IRGC’s affiliated companies in the oil and gas industry.

Chapter IV will respond to the third sub-question which is devoted to examining and identifying the historical development of the IRGC’s involvement in the economy and its expansion to a central player in the energy sector. The large part of the chapter is allocated to the activities of the IRGC and its subsidiary companies in the energy sector, with a focus on the beginning of the IRGC’s access to the oil and gas industry, Khatam al-Anbia’s activities in oil, gas, petrochemical areas, the development of the IRGC’s involvement in the energy industry during the Iranian presidential terms (2000-2019) to illuminate the influence of the political factions in this process.

Finally, to bring this thesis to the end, chapter V will come to the conclusion to recapitulate the findings of the present research by which the core research question can be answered. Also, it will be evaluated the results to confirming or rejecting hypotheses, and discussing the strengths and weaknesses of this work.

***

32 II. TRANSFORMATION OF THE ISLAMIC REPUBLIC FROM STATE CORPORATISM INTO THE NEO-MERCANTILIST DEVELOPMENTALIST STATE

2.1. Introduction The purpose of this chapter is, in the first step, to overview the situation in which the IRGC was the establishment to serve the consolidation of the Islamic Republic as a form of ‘state corporatism’ during 1979-1989. Secondly, the aim is to investigate the political and economic mechanisms involved in the evolution of the IRGC from its original function into a leading actor in the economy, which derived from the changing of the political and economic structure, especially stemmed from the top-down economic development strategy of the Islamic Republic. For the economic factors, it will be looked at the structure of the Islamic Republic’s economic strategy to implement the economic liberalization policies since 1989. As before noted, the liberalization of the Iranian economy consists of the exchange rate unification and floating the rial; (2) elimination of price control and subsidies; and (3) the privatization of the SOEs. It will be examined the impact of this transformation on the economy and the position of the social classes and interest groups. An important aspect of this change is to explore how the parastatal and military institutions were involved in various economic fields in the purpose of the continuity of the state’s control over the economy. Therefore, to analyze these factors, it is necessary to investigate how the political factions - when they control the state’s organs as a result of their victory in the presidential and parliamentary elections - implement the liberalization of the economy and affect the involvement of the IRGC in the economy. To achieve these objectives, the following question is central to this chapter: What are the political-economic mechanisms involved in the IRGC’s presence in the economy?

To address this development, this chapter is divided into two sections, with each section allocated to two periods of post-revolutionary Iran. The first section (2.2) covers a short analysis of the political economy of the Islamic Republic in the first decade of post-revolutionary Iran (1979-1989). This section provides an overview of the socio-political context in which the necessity of the IRGC’s foundation and its role in this period. Moreover, it will be put forward how the confronted political-economic crisis forced the regime to transfer into the neo-mercantilist developmentalist state’s form and to execute economic liberalization. The second section (2.3) investigates the second period of post-revolutionary Iran (since 1980). This section discusses three points: (2.3.1) the nature of neo-mercantilist developmentalist state in Iran and the approach of the political factions toward the top-down strategy of economic liberalization; (2.3.2) privatization of SOEs; and (2.3.3) privatization and the involvement of parastatal and military institutions. Lastly, this chapter ends with a conclusion.

33 2.2. State Corporatism and the role of the IRGC during 1979-1989 This section is shortly concerned with the political economy of the Islamic Republic of Iran in the first period of the post-revolutionary order and the origin and position of the IRGC as a military institution within this system as a form of state corporatism. Referring to the theoretical framework, the crisis of social hegemony, whereby no dominant classes can achieve the hegemony over other social classes, requires among others an organized and ideological military institution to eliminate social tensions to help the consolidation of the political system and needs economic institutions to organize and control the economy. This development will be examined the following.

2.2.1. State corporatism in post-revolutionary Iran The Iranian revolution was the outcome of an explosive, but an unprepared and unorganized social uprising. The general origins and demands of this movement were anti-capitalist in nature. The upheaval movement, whose slogans were essentially populist, challenged mainly the ‘dependent-capitalist’ of the Pahlavi regime. Nevertheless, there was no clear political and economic perspective to replace the established capitalist formation. The nature of the political economy of the establishment of the Islamic Republic was derived from these developments, and the intensive socio-political struggle and tension between different classes, social strata, and various political and ethnic groups that pursued their political and economic interests. In this socio-political context, both the ruling capitalist class together with the Pahlavi’s regime and the revolutionary and leftist groups were unable to achieve own dominant position and establish a new social order. Consequently, a ‘passive revolutions’ took place and, as a direct result, the bazaaris and clerics - socially as traditional petty-bourgeoisie and politically as the body of political Islam forces - took control over the power by using repressive coercion against the upheaval social movement without changing the older social order fundamentally.

As a direct consequence, the passive revolution of 1979 did not result in a radical transformation of the former capitalist mode of production. The established new order was, however, the continuity of the capitalist socio-economic formation with some reforms on the surface of the society, which was a form of state corporatism between 1979 and 1989. As Bayat (1988) highlighted, “corporatism in Iran featured such additional ingredients of Islamic ideology as the corporatism of Islamic workers, mashru ("legitimate") capitalism, maktabi (literally, "Islamic") management, and the Islamic State, all of which cooperated for the common cause of the nation (p.51). Within this political-economic order, a repressive and coercive force as the IRGC was necessary for maintaining social order and security for the newly established Islamic State in Iran. At the level of social forces, the social conflict and the anti-capitalist nature of the revolutionary uprising resulted eventually in the state corporatism of the Islamic Republic. Consequently, the state, in turn, impose its authority upon the society to maintain order, to regulate working conditions, to promote social harmony, and to eliminate conflict across the country.

First, a wave of mass strikes of workers in several industrial centra from October 1978 to February

34 1979 played an important role in the downfall of the Pahlavi’s regime. After the Revolution, the emergence and development of the labor council movement from February 1979 to July 1982 intensified the conflict between the workers and the position of capitalist dominance in the production process. The increasing emerge of workers’ councils and “other popular and grass-roots organs – such as district committees, peasants' councils (in the northern provinces), employees' councils within the state administration, and councils of cadets in the air force” (idem, p.44) - marked the social conflict during and after the revolution. Alongside this development, on the eve of the revolution and the months that followed, a series of political and economic slogans and demands were at the forefront of the struggles of the workers and the upheaval masses demonstration, such as nationalization and confiscation of heavy industries, banks, mines, large property and real estate (Nomani & Behdad, 2006, 24). Especially, the leftist groups and the radical section of the labor movement underlined the nationalization of the major industry as part of a socialist transformation of Iran (Harris, 2013, 49). Hence, as a result of this revolutionary upheaval, the right of property and capital was significantly undermined.

Second, the Political Islam forces in Iran, under the leadership of Khomeini (1902-1989), is originally a middle-class movement that mobilizes the masses against the established power of Pahlavi’s regime. This derived from the fact that the capitalist economic development during the 1960s and 1970s provoked a relative decline in the traditional petty bourgeoisie and its clergy allies, which caused the dissatisfaction of these social groups. Although this political group was attacking the previous regime, they were careful to respect the property right and refuses to present a clear plan that may be harmful to the petty bourgeoisie. They are more inclined to make changes at the superstructure level (cultural and political) of the established political-economic system than to overthrow the mode of production and distribution of former capitalist relations (Abrahamian, 1993, 70), which is an important feature of a condition for a passive revolution.

The Political Islam forces were forced to accept the anti-capitalist tendency as a populist policy to mobilize and canalize the social uprising. In response to this trend, the newly established Islamic Republic confiscated all banks, companies, and many large factories, foreign trade, and undeveloped (Mawat) land (Bakhash, 1989,186–201). In the first period of the 1980s, virtually 90% of manufacturing companies employing over five hundred workers and almost 95% of firms with more than one thousand employees were owned or under control of the state (Karimi, 1986, 42). Furthermore, the emerged workers' councils took control of several industrial and economic centers whose owners had fled the country. Consequently, the legitimacy of capitalist economic relations and its capacity to maintain its dominant position over the economy had collapsed in many ways as a result of the action of the worker’s council and state’s intervention in the economy.

35 Hence, this social conflict faced a lack of hegemony by the revolutionary forces. Workers and other revolutionary forces were unable, both at the level of organization and political leadership, to become a dominant hegemonic force in this transformation period. In light of the weaknesses of the labor movement during and after the Revolution, the workers' organization, such as Shuras (Councils) could not have influenced the political process of the transition into the new regime. More important, “the working class, as well as the traditional left, became confused by the populist, “anti-capitalist”, and “pro-downtrodden” stance of the Islamic state” (Bayat, 1988, 43-47), which led to the following of this movement to the populist policies of the Political Islam forces that gradually faced its repression.

In the context of a situation in which neither the labors nor the capitalist class has not been able to achieve its hegemony to maintain the “order” and provide a dominant socio-economic order, the political Islam forces took the opportunity and, through the determinant supporting of the Western Powers (Saidi, 2019) and using populist politics to canalize the social upheaval, seized the political power and established a form of state corporatism. Establishing and imposition of the Islamic Republic on the crisis of the post-revolutionary Iran was accompanied by two actions by the new nascent order. First, the establishing of the IRGC as a military vehicle to consolidate the new order, and, second, the several parastatal economic institutions, bonyads, to control the economy. The IRGC was the military arm, and, bonyads became the financial arm of the regime.

2.2.2. The origin and position of the IRGC in the consolidation of the Islamic Republic On the one stage, soon after the collapse of Pahlavi’s regime in February 1979, the new regime established a wide array of political, economic, military institutions to reinforce its position against active social movements and political groups. Within this situation, near after the declaration of the Islamic Republic of Iran, on 5 May 1979, Khomeini decreed to the Revolutionary Council, one of the main pillars of the Political Islam forces, to establish the Sepah-e Pasdaran-e Enghelab-e Islami (literally the Guardians of the Islamic Revolution). As stated in the 1979 Iranian Constitution, the task of the IRGC within the Islamic Republic was to ‘guarding the revolution and its achievements’ (IPRC, 2020). In reality, the primary purpose of the IRGC’s as a paramilitary force was to monitor the remainders of the shah’s military and protect the newly established Islamic state from domestic social movements and opposition political groups to consolidate the Islamic state.

Of course, given that Khomeini realized that the departure of the shah was not as the end of the power struggle and challenges on the way to establish its Islamic state, he continued to empower its position by establishing a new military vehicle for helping consolidate power and undermining the Provisional Government (led by Prime Minister Mehdi Bazargan) as well as the Leftist Secularist factions that had become emboldened in the armed clashes of the revolution’s heyday (Maloney, 2015, 99; Forozan, 2015, 157). In the light of the circumstance that Arrtesh, the regular army, was mistrusted by Khomeini, the IRGC has become the main military alternative as a coercive counterweight and

36 ideological apparatus to consolidate the Islamic regime (Keddie, 2003, 246), to secure its control over the political power and survival the nascent established Islamic Republic through creating order, securing and preventing domestic uprising across the country. Consequently, the IRGC employed its military oppression in crushing the various uprising that broke out across the country, including the uprising of Sunni Arabs in oil-rich Khuzestan, the Resistant Movement of Kurdistan, Azarbaijan, and Torkamansahra (Zabih, 1988, 211).

Parallel to the consolidation of the Islamic Republic, the strike committees, workers’ councils, and unions were repressed by the (para)military institutions. During 1979-1981, the wave of labor struggle in the industrial workplaces confronted with the repressing of the various organs of power, among others Sepah Pasdaran (the IRGC) (Bayat, 1988, 50). The real power of the secular councils was gradually undermined and repressed by the state apparatus, and the system of one-man management from above was once again reintroduced. The revolutionary workers’ councils “were substituted by state-controlled ‘yellow’ organizations, such as the Islamic Councils (shora-ye eslami), the Workers’ House (Khane Kargar), and the Islamic Labour Party” (Jafari, 2014). Moreover, the IRGC was an apparatus for Khomeini to monopolize power to enhance its institutional autonomy and political-ideological missions (Forozan, 2013, 160-161).

Besides its role in domestic environmental to struggle for securing the Islamic regime and gaining their grip over post-revolutionary Iran, after the Iraqi invasion in September 1980, the role of the IRGC is profoundly changed from a paramilitary organization into a military compact force with taking the lead in the Iranian war effort on various areas (Belstad, 2010, 47-49). During the Iran-Iraq War (1980– 88), the IRGC has expanded its capacity to mobilize volunteer forces to defend the regime and recruits for the frontlines (Golkar, 2012, 627).

To sum up, the role of the IRGC as a military institution in the first decade of the Islamic Republic was to defend the regime against the domestic socio-political struggles and external threats. After the end of the war and consolidation of the regime, an amount of political and economic crisis forced the regime to implement the structural adjustment of the economy whereby the IRGC expanded its function into the economy.

2.2.3. The crisis of state corporatism and the necessity of economic adjustment The consolidation of the Islamic Republic in the first decade of the post-revolutionary period accompanied by the political and economic crisis of state corporatism, as a result of social and class conflicts, undermined the sanctity of property and capitalist relations, disrupting production, and capital accumulation. Although property right was considered sacred in the Islamic Republic, the revolutionary uprising against social and economic capitalist relations, the control of the state over the economy, war, and political instability, disrupted the process of capital accumulation in various forms and put the

37 capitalist economy in a serious crisis, and overt expression of hostility to capital and property rights (see Nomani & Behdad, 2006).

As a result of large-scale confiscations, large amounts of economic property were turned into "public property", under control of the state. The confiscated properties were given to parastatal institutions or extra-governmental institutions. It should be noted that ‘the Foundation for the Dispossessed and Veterans’ was established by the order of Khomeini in 1979 to protect and manage ‘public property’. Shortly afterward, other foundations such as the Martyr's Foundation and the 15 Khordad Foundation were established (Maloney, 2000, 153). These economic institutions became the financial arm of the Islamic Republic. In the face of such a situation, production was severely disrupted, the formation of gross fixed capital (investment) had fallen sharply, the rupture in Iran's international economic ties exacerbated the economic crisis, imports of industrial materials and capital goods fell more seriously, and tensions between the regime's factions over the structure of the new economic system continued to exacerbate the situation. The need to freeze social and political tensions by military and intelligence agencies, as well as to control the economy in the hands of the state and its affiliates’ foundations, to strengthen the consolidation of the IR, has led the economy to monopolize further.

In such circumstances, it provided opportunities for rent-seeking for regime officials, mainly clerics, and their supporters. They have gathered in various forms through affiliated organizations around nationalized institutions, and most importantly, in parastatal foundations. Thus, some huge monopoly companies were established in the collapsed capitalism of Iran (Nomani & Behdad, 2006, 75-84). The Dispossessed Foundation alone owned 400 companies with the exclusive ability to produce many basic goods. With about $12 billion in assets, this foundation was the largest economic unit in the Middle East (Waldman, 1992, Maloney 2000, 153(. The decline in oil revenues between 1986 and 1988, due to the saturation of the global oil market and the destruction of Iran's oil facilities in the war with Iraq, put the Islamic regime in a position that could no longer be sustained (see chapter III). Faced with these deep economic and political crises, the Iranian regime was forced to transfer into a form of neo- mercantilist developmentalist state and to consider economic adjustment.

2.3. The emergence of neo-mercantilist developmentalist state and the IRGC’s involvement in the economy This section explores the political economy of the Islamic Republic in the second period of post- revolutionary Iran. Firstly, I shall describe and analyze the nature of the neo-mercantilist developmentalist state and economic liberalization in Iran since 1989 whereby the structure of political power and economy has transformed from above by implementation of structural economic adjustment in various fields, which caused the involvement of the IRGC in the economy. Secondly, it will be presented the privatization process and the role of military and parastatal institutions in this process.

38 2.3.1. The nature of the Iranian neo-mercantilist developmentalist state Refers to the theoretical framework, the Iranian neo-mercantilist developmentalist state had three important features: (1) it has been pursuing to maintain its control over its instrument necessary to reshape the economy by its affiliated parastatal foundation and well-organized military institutions as the IRGC; (2) it has implemented a top-down strategy of economic development by continuous growth and structural change through a ‘dependent development’ strategy in line with the prescription of international financial institutions; and (3) the factionalization, the rivalry between political factions for capture state’s resources, giving more scope for private capitalists, who favor and secure more liberal economic policies, which influence the extent of state-linked organizations and interest groups in the economy.

The accumulation of political and economic crisis and many other contradictions that the Islamic Republic confronted, associated with the state-led economy. The significant challenge for the Islamic Republic was stimulating capitalist economic development and growth, at the same time, maintaining control over the society (including the economy), and survival of the IR. These challenges forced the regime to adapt to structural economic adjustment by a top-down strategy. As before mentioned, adapting the neoliberal economic policies in Iran included unification of the exchange rate, floating exchange rate system, the privatization of SOEs, the elimination of price controls, and subsidies. The liberalization of the economy requires the provision of security and high profitability facilities for capital by reconstruction of the income distribution in favor of capital. Hence, the duty of the Iranian state was to commit itself to arrangements of capital such as encouraging the private sector to have a suitable space of activity and to eliminate its presence in the economy, both as a producer and as a regulator. The state has to provide the necessary condition under which capital accumulation can maximalize, which includes foreign borrowing, liberalization of prices, increasing private investment in the economy, and privatization of SOEs (Nomani & Behdad, 2006, 106-107). The implementation of this strategy and policies was on the agenda of all of the political factions within the IR. Regardless of some differences in policies and propagandas, tensions and rivalries between political factions and elites are being over how to resolve their socio-political and economic crisis and, consequently, to preserve the downfall of the regime. The way in which the economic liberalization policies have been executed and the approach of each political factions toward this strategy during presidential terms will be presented and analyzed following.

Firstly, in the direct aftermath of the Iran-Iraq War, the bourgeoisie, whose leftover from the developments of the revolution and the war, turned its struggle into the political arena and launched the economic liberalism as the inevitable perspective to develop the economy and to survive the regime. The alliance between the ‘mercantile bourgeoise’ – mainly the traditional bazaaris – and the pragmatist faction, under the leading of Akbar Hashemi Rafsanjani took charge of the implications of Iran's economic liberalism (Ansari, 2012, 345). They promoted that a “modern” and competitive market

39 economy was the correct path for the country (Ahmadi- Amui, 2003, 271). The “Islamic leftist” faction was critical about economic liberalization because they concerned about “further empowerment of the and the factions affiliated with the merchant class” (Moslem, 2002, 163-6, in Maloney, 2015, 203). Rafsanjani’s approach was a top-down strategy for economic liberalization so that the state plays a key role in the transformation of the economy to maintain its control over the economy. The First Five-Year Development Plan (known as the structural adjustment program) implied a significant transformation of economic policies, which coincided with the prescription of the International Monetary Fund (IMF) Economic Adjustment Program to Iran (1988-1993) (IPRC, 1990). During a visit by a delegation from the IMF and the World Bank to Iran in 1990, the IMF reported that Iranian officials "expressed their determination to take part in the comprehensive economic adjustment of the country's macro-economy, to play a stronger role for the private sector and to gradually eliminate economic regulation" (Nomani & Behdad, 2006, 88-89). The primary aims of this plan were promoting industrial growth, curtailing the role of the government, improving the tax system, and reopening of the economy to foreign investment and capital, managing the budget deficit and , adopting import substitution and export promotion policies, optimizing resource exploitation (Maloney, 2015, 201; Rakel, 2008, 93). Within the framework of economic liberalization, the Iranian government introduced a model of the “buyback contracts” as a mechanism for attracting foreign investment in the upstream oil sector (see Chapter III). Moreover, Rafsanjani’s administration announced various economic reforms to encourage private-sector growth, such as the unification of the exchange rate, floating exchange rate system, privatization of SOEs, liberalization of prices, and elimination of subsidies (Cammett, et al., 2015, 312). During the ‘reconstruction era’, Rafsanjani sought to utilize the resources and well- organized military forces and a host of parastatal organizations to advance its construction plan, including the IRGC and Basij forces, to participate in economic development (see more details in chapter IV). Despite significant economic transformation during Rafsanjani’s tenure, the configuration of power between the state and the market did not change fundamentally, which is stemmed from the continuous controlling of the economy by the state. For instance, after seven years of pursuing a policy of privatization, the government (and its parastatal and military entities) continued to be a major player in the economy. Furthermore, during the second half of the 1990s, the Iranian economy was faced with “stagnating growth, high inflation, high unemployment, weakened national currency, and a significant increase in the gap between rich and poor. This development led to social unrest in several great cities and strikes in key industrial centers. The protests were heavily suppressed with dozens of people killed, hundreds injured, hundreds arrested some of whom executed” (Rakel, 2008, 104). The social unrest forced the government to step back and control the prices again. Also, the state bureaucratism has increased and privatization was limited. Consequently, the economic and political crisis posed new challenges to the IR.

40 Secondly, the coalition between two factions within the state, “a liberal coalition promoting economic liberalism and the hard-core remainders of the populist statist tendency” (Behdad, 2000, 35), resulted in the presidency of Mohammad Khatami in 1997 to govern the IR. Despite their critic toward Rafsanjani’s approach, after his election, Khatami propounded an economic reorganization plan in 1998 whereby he emphasized both economic liberalization and political reforms. Arguing that the implementation of economic reforms is subordinated to political modernization, Khatami and his circle reformists who accepted Rafsanjani’s view of economic liberalization, promised to tackle the existing social and economic challenges by a policy of rapid economic development but also “social justice.” His introduced ‘Third Five-Year Development Plan’ (2000-2005) represented an ambitious effort regarding structural reforms to the economy, such as “providing the transfer of companies whose activities in the public sector are unnecessary to the non-governmental sector” (IPRC, 2000). The plan emphasized addressing “the enlargement of the private sector; increases in domestic and foreign investment, as well as export; and the development of the non-oil sectors” (Rakel, 2008, 98). According to this plan, it is necessary to break up the public ownership would except where “the state has a natural monopoly.” As Nili recalled in 2002, “The [plan] managers that had statist economic orientations are today implementing plans oriented towards a modern competitive economy and support of the private sector” (Ahmadi, 2003, 272, in Harris, 2003). In other words, according to Khatami’s economic program, on the one hand, the solution to Iran's economic recovery is to mobilize domestic capital and attract foreign investment through the guarantee of capital security and elimination of constraints imposed on the private sector. On the other hand, in Khatami’s vision, political liberalization was an important factor to achieve the liberalization of the economy. For instance, he promised to do “its best to maintain social justice and a more equitable distribution of income” (ICANA, 1998; in Behdad, 2000, 36) to satisfy the populist-statist factions of his alliance. During its two terms, Khatami attempted to tackle several complex economic issues, such as privatization, significant enhancements to the trade and capital investment, unification of exchange rate, and the establishment of a to hedge against oil revenue volatility. The economic policy had a common consensus with the paradigm of the Pragmatist faction in terms of supporting further privatization to attract foreign investment, as well as the Conservative faction, who was careful about the scope of privatization. Within this framework, Majles approved legislation authorizing the establishment of private banks in 2000, the National Privatization Organization was established to manage the privatization of SOEs, and Iran’s Oil Stabilization Fund (OSF) was established to insulate Iran’s budget from oil price volatility (Maloney, 2015, 290-91). Despite these efforts, Khatami and his reformist supporters did not achieve their planned economic liberalization project as planned.

Thirdly, in July 2005, Ahmadinejad came to power and dominated all key organs of government by calling on the well-organized military forces and political machines, the Basij forces and the IRGC, as well as presenting a populist plan to attract those affected by the economic liberalism policies during

41 last fifteen years. Like its previous reformist competitor, the economic strategy of Ahmadinejad was in line with Rafsanjani’s post-war platform of capitalist development, including the privatization of SOEs and the liberalization of the economy. His achievements in this era were the elimination of and the initial of a major privatization program (Cammett, et al., 2015, 314). Regarding the latter, in July 2006, the supreme leader mandated the government to privatize 80% of all SOEs (see section 2.3.3). Within this policy framework, in 2007-2008, Ahmadinejad’s administration launched a plan to set up a system of interest-free banks, merging some state-owned banks, which led to tension between political factions and state elites (Maloney, 2015, 334). A large share of the divested share of SOEs went to parastatal and military institutions. Although the IRGC entered the economy since the launching economic liberalization during Rafsanjani’s era, during Ahmadinejad’s tenure, the involvement of the IRGC in different fields of the economy became more prominent and decisive, especially in the oil and gas sector (see chapter IV).

Fourthly, in 2013, Hassan Rouhani was elected to the presidency. Rouhani promised the encourage the security environment for economic growth by reforms and “the removal of sanctions and the reintegration of the Iranian economy into the global economy” (Cammett, et al., 2015, 314). Also, he promised to eliminate the parastatal monopolies in the economy, which undermines, he promoted, a competitive economic environment for the private sector and the execution of the privatization program. Rouhani announced that “the economic environment must be competitive and transparent, monopolies must be broken and rents must be eliminated” (VOA, 2013). In terms of the privatization plan, based on Article 44 of the Constitution, he pointed out that “the basis of the policy has to make our economy competitive and to reduce government ownership and to leave the work to the non- governmental sector” (Tabnak, 2013a). Despite these pronouncements, regarding the IRGC's encroachment on the economy, Rouhani involved the IRGC in the economy and stated in 2013 that “the IRGC is not a competitor of the people and the private sector, and it is not and has not been a regular contractor. Today, the IRGC should undertake important projects that the private sector cannot afford (DW, 2013). Following this trend, to finance oil projects in 1399 (2020-21), “the Ministry of Petroleum, is allowed to issue $3 billion in Islamic financial securities. In another section of the 2020 Budget Plan, operating banks will be allowed to provide up to $3 billion in facilities to private sector investors, and public non-governmental organizations, and Khatam al-Anbia for upstream oil and gas development projects” (ISNA, 2020). A member of the Energy Commission of the Islamic Consultative Assembly announced that a meeting was attended by Bijan Zanganeh, the MoP, and Saeed Mohammad Eslami, Commander of Khatam al-Anbia. He said: "In this meeting, bilateral cooperation between the MoP and Khatam al-Anbia for the development of petroleum refineries after the development of executive regulations and its approval by the government was pointed out. Also, the Kermanshah Anahita project will be started by Khatam al-Anbia. He added: "It was also decided that Khatam al-Anbia will cooperate with the MoP in the construction of petrochemical parks, completing

42 the production capacity of the Star Gulf Condensate Refinery and other oil industry projects" (SHANA, 2019a).

Foreign borrowing and debt The effort to attract foreign capital was a step toward economic liberalization as a ‘dependent development’ strategy of the neo-mercantilist development state of Iran. The acute crisis of foreign exchange and its chronic shortage of domestic investment forced the Islamic Republic to abandon its former populist slogans against foreign capital and to borrow from international financial institutions to secure its economic policies. Despite the opposition of some internal factions and leaders toward foreign borrowing, which was considered a "revival of Iran's dependent capitalist economy during the Shah's era", the requirements for reconstructing the liberal capitalist economy made foreign borrowing unavoidable (Nomani & Behdad, 2006, 88-89). To achieve external borrowing, the state had to demonstrate its commitment to rebuilding market institutions and encouraging a free market economy as a requirement of the neoliberal global economy.

Therefore, in the first step, a sharp increase in imports required foreign borrowing to plug the gap between export and import. The first economic plan of the Rafsanjani’s government was estimated at $28 billion in foreign borrowing (idem, p. 47). The government's foreign borrowing and external debt soared from $4 billion in 1990 to almost $22 billion in 1994 and 1995, which caused a mini–debt crisis in the mid-1990s (World Bank, 2001). As shown in Figure 2.1, this trend dropped to $12.6 billion in 1997. During Khatami’s tenure, the foreign debt had ups and downs trend, whereby it dropped to $9 billion in 2000 and rose again to $23 billion in 2004. When Ahmadinejad was elected to President in 2005, the trend of foreign debt reached its peak in 2007 with almost $29 billion, while it decreased to around $22 billion in 2008-2010. With imposing the international sanction against Iran since 2011, the Iranian foreign debt fell significantly to $7 billion in 2012. During the presidency of Rouhani, it decreased continue to $5 billion in 2014-15, and increased once again to approximately $7 billion (2015-16), $8,5 billion (2016-17), and $10 billion (2017-18).

43 Figure 2.1 Total Iranian external debt between 1993 and 2017

)

dollars

28647,1

24264,2

million

23158

23513,7

22737

22697

23073,7

22814,4

21526

in in

21502,1

19184,7

17725

17024

14759

12672

12530,2

11110

10910,1

9043,8

9011,8

8481,4

7682

7475,5

Total foreign debt ( foreign debt Total

6654,8 5107,2

Years

Source: CBI (2020) (author calculations).

The liberalization of price The liberalization of the foreign exchange market began at the beginning of the 1990s. In the early 1990s, the free-market price of foreign exchange was twenty times higher than the official rate (Cammett, et al., 2015, 313). Rafsanjani’s administration announced the government's decision to privatize hundreds of SOEs and the government has stopped controlling the prices of most of the goods produced by the private sector. The liberalization of prices accompanied by an increase in oil revenues. In response to a sharp drop in the rial’s exchange rate, Iran's oil revenues also declined as prices rose. Central Bank of Iran (CBI) loans and commercial bank credit facilities financed the state budgetary deficits. This led to a dramatic increase in inflation averaging 24% per year and reaching 50% in 1996 (Rakel, 2008, 94).

Iran’s “perestroika”, however, confronted with several challenges: a crisis ensued due to an oil price collapse in 1993 and 1994, unemployment and inflation reached untenable levels, and protests broke out in several major Iranian cities. Rafsanjani reluctantly backed off from his reforms (Harris, 2013, 51). Therefore, the government launched the zigzag strategy to continue economic liberalism. As a result of increasing foreign debt in the 1990s, the Rafsanjani’s government has controlled the exchange rate. This also put the Islamic Republic in a difficult position in terms of currency credibility. As a result of these developments, prices rose by about 60%. The increase sparked strong social protests. This has led the government to re-determine price fluctuations. The devaluation of the rial had an inflationary effect on the economy. All of this is leading to a decline in the living standards of the general public, which, according to proponents of economic liberalism, is a gift to the economy. Due to the inflationary trend, followed by a reduction in real wages and living standards,

44 reduces the distribution of labor and increases the share of capital (profit) in the economy. As a result, consumption is reduced and investment is increased (Nomani & Behdad, 2006, 93-95).

Investment in the economy Raising investment in the national economy is another goal of the policy of economic liberalism. As a result of the economic liberalization, state investment in favor of reconstruction increased from 25% of GDP in 1986 to 35% in 1991 (Cammett, et al., 2015, 313). “Beginning in the early 1990s, mayor Ghulamhusayn Karbaschi (r. 1989–98) encouraged speculative capital to further move into housing and commercial construction projects, extracting “fees and taxes from merchants and developers in exchange for exemption from zoning laws and protection from political pressure.” Private investment in the city’s construction sector from 1987 to 1997 increased by a factor of fifteen, funding Tehran’s “growth machine” as the capital’s high-rise skyline and ringed highways took the shape recognized today” (Ehsani, 2009, 29-30, in Harris, 2013, 53).

In the early 1990s, total investment (at constant prices) increased as economic growth caused by rising oil prices. The share of GDP in gross national expenditure in the early years of economic liberalism also increased, resulting in a decrease in the share of private consumption expenditure and an increase in imports (Nomani & Behdad, 2006, 93-95). Besides, by 1991, public enterprises accounted for 73% of industrial value-added, 72% off employment, and 65% of investment (Amuzgar, 1983, 140). Despite this trend, after seven years of pursuing a policy of privatization, in 1996, the government (and foundations) continued to be a major player in the economy. Between 1986 and 1996, the number of government employees increased by about 35% instead of decreasing. According to the CBI, between 1990 and 1996, public sector investment increased from 32% to 43% of the total investment (Nomani & Behdad, 2006, 94).

In general, in the first decade of economic liberalism, Iran's economy grew with (and benefiting from) rising oil revenues. This, and the more fuzzy political space for the private sector, facilitated the process of capitalist accumulation reflected in the growth of private sector investment. However, pursuing a policy of economic liberalism had little effect on the process. Because its implementation was accompanied by disconnection and connection and did not lead to a significant reduction in the share of government economic activities in the market. However, as a result of the developments of economic liberalism, the increase in the accumulation of private capital led to the increasing proletarianization of the labor force (idem, 100).

2.3.2. Privatization of state-owned enterprises The privatization of SOEs was an important aspect of economic liberalization. As noted before, in the purpose of the interests of the Iranian bourgeoisie and development of the capitalist economy, the Pragmatist (constructionists) faction, led by Hashemi Rafsanjani, put the implementation of privatization on the agenda. One aspect of Rafsanjani’s first Five-Year Plan, by emphasizing on

45 “transfer of shares of state and nationalized industries (except for large and mother industries) to the public”, was to eliminate state control in the economy (IPRC, 1990). The execution of the plan started with a government’s announcing to privatize 400 of 3.000 SOEs. During the first period of privatization (1990-94), in total, the sale of the SOEs was 1.7 trillion rials. In the second period of this process, between 1995 and 1997, the divested shares were 1.8 trillion rials (Amuzegar, 2007, 60). In 1997-98, solely in acceding of 3.3 trillion rials in shares were divested to the private sector (IPO, 1997).

Given the fact that the state and parastatal institutions controlled the national economy in the first period of post-revolutionary order, the privatization of the large economic industry can lead to the undermining of their power. Therefore, the interest groups had an enormous impact on the privatization of SOEs process. During this process, the involved foundations accorded to sell parts of their assets to the private sector, worth 62.2 billion rials (Amuzegar, 1993, 100). In the first decade of the economic liberalization process (in the 1990s), from 770 public enterprises, the government announced that just 391 companies could be privatized according to the constitutional language of Article 44 (Harris, 2013, 51). As seen in Figure 2.2, during Rafsanjani’s era (1991-97), the value of total divested SOEs was approximately 3,5 billion rials, which is 0.2% of the total value.

Figure 2.2 Divested value and number of State-Owned Enterprises' share during Presidential terms (1991-2019)

1.313.911

1.400.000

1.200.000

1.000.000 224.367

800.000 343 600.000 Rouhani admin. (2014-2019) 27.111 653 400.000 Ahmadinejad admin. (2006-2013) Value(in billion rials) 374 200.000 3.497 391* Khatami admin. (1998–2005) Rafsanjani admin. (1991–97) - Value Number Presidencial term

Source: IPO (for data of 1991 to 2013 see IPO, 2014, 10; and for the rest see IPO, 2015, 11; 2018; 2019), author calculation), author calculation.

*Given that the number of divested enterprises before 2001 (1380) is not available in IPO data, the mentioned number (391) during Rafsanjani’s period is based on Harris (2013, 51).

46 Figure 2.3 The divested value of State-Owned Enterprises' share, 1991-2019.

Divested value of state-owned enterprises' share

464.620 464.620

254.326

Value (in billion (in rials) Value billion

158.342

134.323

130.350

77.916

62.649

51.477

49.242

38.881

37.189

32.220

31.385

15.358 15.358

10.739

7.166

3.360

2.348

1.722

1.091

924 924

813 813

762 762

516 516

288 288

266 266 239

173 173 201

Year

Source: IPO (for data of 1991 to 2013 see IPO, 2014, 10; and for the rest see IPO, 2015, 11; 2018; 2019), author calculation.

Note: Persian calendar years start on surrounding March 20 (e.g, Persian calendar year of 1370 started on 21st March 1991 to 20 March 1992)

The necessity of privatization of SOEs continued during Khatami’s era. Based on the indication of a government commission, solely 128 out of 724 companies needed to remain state-owned. Also, it recommended privatizing more than 1.000 parastatal enterprises, including those controlled by large foundations and related institutions (Khajepour, 2000, 577-98). As is seen in Figure 2.2, during this period, the value of transferred SOEs’ share, compared to the previous period, has increased to almost 27 billion rials. The number of privatized companies between 2001 and 2005 (1380-1384) was 374. Moreover, Figure 2.3 indicates that the privatization process remained less than 10 billion rials annually during 1991-2005. The divested value and number of State-Owned Enterprises' share rose significantly since 2006, which coincident with the notification of a new low on the privatization of SOEs, and the election of Ahmadinejad as the new . This increase is the outcome of the call of Khamenei, the Supreme Leader of the Islamic Republic, in 2005 for the privatization of large-scale and mother industries. According to this order, “the government has no right to engage in new economic activities outside of Article 44 and is obliged to transfer any activity (including the continuation of previous activities and its operation) that is not subject to Article 44, to the non-governmental , private and public sectors until the end of the 4th five-year plan (20% annual reduction of activity)” (Cabinet Office, 2005). Based on this directive, the public sector includes all major industries, mother industries, foreign trade, large mines (excluding oil and gas), banking, insurance, power supply,

47 dams and large water-supply networks, radio and television, post and telegraph and telephone, aviation, shipping, roads, and railways (ibid).

Furthermore, in July 2006, Khamenei promulgated Article 44 (c) of the Constitution and ordered the government to transfer 80% of shares of SOEs subject to Article 44 to private sectors, public joint- stock cooperatives, and non-governmental public enterprises (Khamenei, 2006). The latter subject to the parastatal foundations, such as public pension funds, contractor companies affiliated to military institutions, and endowed foundations. Khamenei’s directive was codified into law on January 28, 2008 (MCLS, 2008). As the chairman of the IPO highlighted, according to Article 44, SOEs are divided into three groups. First, Group I companies have no government duties and 100% of their shares must be transferred to the private sector. Second, Group II companies must also transfer at least 80% of their shares to the private sector. Third, Group III companies, which are solely government-owned, must remain 100% state-owned (, 2019a).

After the notification of this new law, the privatization of SOEs has increased significantly. This allowed Ahmadinejad’s administration to accelerate the privatization policy to use it as his success, which the former governments were failed to enact. Based on the statistics in Figure 2.4, it can be seen that, since 2005 and after the announcement of the general policies of Article 44 of the Constitution, the process of transferring shares of SOEs has gained more speed and intensity.

As shown in Figure 2.4, prior to this announcement, i.e. from 1991 to 2005, 30.6 billion rials were transferred from the shares of SOEs to the private sector, which accounted for solely 2% of the total transfers from 1991 to 2019, while since 2006, 1.538 billion rials of shares have been transferred, which accounts for 98% of the total. According to IPO data, the total number of transferred SOEs (totally or partially) during 2005-2013 was 653. This demonstrates that the divested SOE assets during Ahmadinejad’s era were far more than its predecessors. This giant amount of transferring went to the oil, chemicals, metals, electricity, and sectors (Harris, 2013, 56).

Figure 2.4 The comparative value of the transfer of shares of state-owned companies before and after the notification of the general policies of Article 44 of the Constitution.

Value (in billion rials)

30.608 ; 2%

1.538.278,0 ;

1991-2005 2006-2019

Source: IPO (for data of 1991 to 2013 see IPO, 2014, 10; and for the rest see IPO, 2015, 11; 2018; 2019).

48 The value of these divested companies was about 1.314 billion rials. Based on an annual analysis, the value of privatized SOEs increased from 813 million rials in 2005 to more than 31 billion rials in 2006, 158 billion rials in 2007, and almost 255 billion rials in 2009 (Figure 2.3). According to (2009), Ghulamriza Haydari Kurd-Zanganih, the head of the IPO stated that, since 2005, the number of transferred companies was 270, which has reached 630.000 billion rials. This trend dropped sharply to 77.9 billion rials in 2010 and increased once again to 134 billion rials and 130 billion rials in 2011 and 2012, respectively. The significant increase in the privatization of SOEs achieved its peak in 2013 with a value of 464,6 billion rials.

Election of Rouhani accompanied by a decrease in the privatization of SOEs. Figure 2.2 demonstrated that during this period 343 SOEs have divested to the “private sector”. The total value of these companies was 224 billion rials, which is much lower than Ahmadinejad’s era but higher than the Presidential terms of Rafsanjani and Khatami. As is seen in Figure 2.3, the value of divested companies fell to 51 billion rials in 2014, and further to 37 billion rials in 2015. According to ‘Stock Transfer Statistics for 2016’, 163 SOEs were transferred to the private sector, which valued approximately 49 billion rials (IPO, 2016). This trend dropped sharply to 15.4 billion rials in 2017, 38.9 billion rials in 2018, and 32.2 billion rials in 2019 (see Figure 2.3).

2.3.3. Privatization and the involvement of parastatal and military institutions In the first term of Rafsanjani’s presidency, the implementation of the privatization of SOEs took place by direct negotiations with interest groups instead of through public auctions. During 1992-1996, the parliament passed a law, allowing the government to transferred SOEs to affiliated people close to the Islamic Republic (Rakel, 2008, 94). Regarding the nature of buyers, during 1989-1994, half of the 331 divested companies went to parastatal foundations (such as the Martyrs’ Foundation and the Foundation of the Oppressed and Disabled) (Muradi, 2005, 190).

As demonstrated in Table 2.1, from 2001 to 2014 (1380-1394), the total value of the divested companies to the private sector exceeded 1.416 billion rials. Out of this, almost 261 billion rials (18%) went to “the real private sector”, while more than 300 billion rials (21%) devoted to ‘Justice Shares’, which placed those assets in the cooperative sector. Virtually 200 billion rials (14%) are transferred instead of debt owed by the state. On the contrary, the value of the transferred value to ‘military institutions, non-governmental public institutions, and foundations of the Islamic Republic was almost 656 billion rials, which is 46% of the total. These facts indicate that even in the privatization process, the state’s affiliated institutions had benefited the most.

Hassan Rouhani, the President of Iran, had told a gathering of the economic activists the following: "Part of the economy was in the hands of a government without guns, which we handed over to a government with guns. It's not economics and privatization” (ILNA, 2017). Also, he had sarcastically told the IRGC in December 2014: "If we all gather information, guns, money, capital, site, newspaper

49 and news agency, Abu Dharr and Salman will also be corrupt" (DW, 2017). Nevertheless, he emphasized earlier in 2015, “I do not accept the rumors about the IRGC at all. The IRGC is not a rival to the private sector (Mizan Online News Agency, 2017). Therefore, “the IRGC should undertake important projects that the private sector cannot afford (DW, 2013).

Table 2.1 The nature of buyers, value, and share of the transferred state-owned enterprises, 2001-2014.

The real Justice Transfers instead of debts Others ** Total private sector shares owed by the government

The value of the transferred shares, 2001-2014 (1380- 1394), in billion rials 261.231 300.804 197.951 656.433 1.416.419

The share of total* 18% 21% 14% 46% 100%

Source: IPO (2015), author calculation. * The value of transfers to the private sector after deducting gradual and preferential transfers is 13.9% of the value of transfers. ** Includes military institutions, non-governmental public institutions, foundations of the IR.

As proved, after four decades of economic liberalization, especially in the field of the privatization of SOEs, the Iranian government and its affiliated parastatal foundation continued to be the major actor in the economy, which ratify our theory and hypotheses that the neo-mercantilist developmentalist state seeks to maintain its control over the economy. For example, the government divested large shares of six petrochemical and power plants to SATA (the Armed Forces Social Organization [known by its Persian acronym, Shastan], an IRGC’s affiliated pension fund) (Maloney, 2015, 334). Also, in August 2009, the IPO announced that 95% of the shares of Tehran’s spacious International Exposition Center had been transferred to SATA as payment for government debt with a worth of 2.000 billion tomans. As a result of much controversy, Ahmadinejad canceled the deal. After the cancellation of the exhibition, at the end of the tenth government in 2013, the transfer of the exhibition was again controversial, and this time Ahmadinejad handed over the exhibition to the ‘Islamic Republic of Iran Broadcasting’ (Tabnak, 2013b). One of the other controversial cases occurred in September 2009, when 51% of the Telecommunications Company of Iran (TCI) was bough by Etemad-e Mobin, an IRGC- controlled consortium, with no competitions at the value of almost $8 billion (Maloney, 2015, 334).

In 2010, according to the Special Commission of the Iranian Parliament, only 13,5% of the privatization process has been transferred to the real private sector since 2006, and the rest has been handed over to the pseudo-state or parastatal companies. According to the report, 86% of these transfers were from SOE to quasi-state-owned companies (DW, 2010; ICANA, 2011). According to Ali Afoneh, the term quasi-private or quasi-state, which is most commonly used in parliamentary reports, is an

50 allusion to the IRGC and the Social Insurance Agency (DW, 2010). Besides, the parastatal institutions include “banks, military firms, state-linked investment and holding companies, endowed foundations, pension funds, and justice shares” (Harris, 2013, 46). In April 2019, Puri Hosseini, chairman of the IPO, pointed out that the private sector in Iran is very small, and in contrast, the public sector is very large. He announced that out of a total of 2.000 institutions and companies that can be transferred, hitherto about 900 state-owned companies have been transferred to the private sector, and about 600 are still in the hands of the government. In the meantime, about 500 companies have been determined about their fate to either be disbanded or merged with other companies (Tasnim News Agency, 2019a).

Although the implementation of economic liberalization led to an important transformation in the structure of the Iranian capitalist economy, the basic configuration of state power in the economy has remained largely. Instead of strengthening and consolidating the private sector, the Islamic Republic during the rule of all governments, despite some differences, has pursued the strategy of reshaping of the economy through the development of the private sector alongside the large involvement of state and its closed parastatal and military entities in the economy. This strategy allowed the state to reshape the economy in favor of capital accumulation, to have control of the economy as the requirement of the state's survival and the interest of interest groups affiliated to the Islamic Republic.

The strong military involvement in the economy was generated since the starting of economic liberalization under Rafsanjnai’s Presidency, expanded during Khatami's era, accelerated under Ahmadinejad's tenure, and continued in the Rouhani’s presidency. The involvement of the IRGC in the economy began during the postwar economic reconstruction in the fields of micro-financing, construction sector, and military industries, road, dams, et Cetra (see Chapter IV). The prominence presence of the IRGC’s contractor companies in the economy has to be considered as an outcome of the structure of the political-economic development process in which both the nature of social forces and the form of the state constituted the Islamic Republic as a certain form of the neo-mercantilist developmentalist state within a non-hegemonic capitalist society.

2.4. Conclusion This chapter focused on examining economic and political mechanisms/factors involved in the IRGC’s engagement in the economy during the second era of post-revolutionary Iran. Analyzed the origin and evolution of the IRGC in relation to the broader context of the Iranian political economy, the results demonstrated that the establishment of the IRGC was a product of the social crisis of hegemony in the wave and after the 1979 Revolution that led to the establishment of state corporatism under the Islamic Republic. The IRGC as a coercive counterweight against progressive movements of the workers' Councils, leftist groups, and ethnic uprisings that broke out across the country played an important role in the consolidation of the Islamic Republic. Nevertheless, the political and economic crisis during the

51 1980s forced the regime to shift toward a ‘dependent development’ by the implementation of economic liberalization whereby the IRGC was involved in the reconstruction of the national economy.

As expected, the transformation of the Islamic Republic into the neo-mercantilist developmentalist state accompanied by a top-down economic strategy to fulfill two crucial aims. On the one hand, the regime implemented rapid economic adjustment programs in line with the prescription of the international financial institutions to develop the economy, which was (1) the exchange rate unification and floating the rial; (2) elimination of price control and subsidies; and (3) the privatization of SOEs. As presented above, this strategy led to high inflation, social inequalities, and, consequently, various social unrest. Moreover, the large proportion of the divested share of the transferred SOEs went to state- linked entities and interest groups, including military institutions, non-governmental public institutions, parastatal foundations. This trend marks the continuation of the state’s control and its affiliated institutions over the economy, which is the other important characteristic of the neo-mercantilist developmentalist state whereby the state has been pursuing to maintain its control over the society.

On the other hand, the lack of unity of the state led to the intensive competition between the political faction within the Islamic Republic to capture the state’s resources and secure their political and economic power. Consequently, the political factions play a mediator role and influence the process of the IRGC’s involvement in the economy. Nonetheless, despite the rivalry and difference among them, all of the political factions advocated for and implemented the liberalization policies to achieve economic development, economic growth, reinforcement of capitalist mechanisms, and encouraging capital accumulation.

There is no doubt that oil revenues play a critical role in the development of the Iranian political economy. Especially, the economic development program of all government’s administrations depended on the oil revenues. Consequently, in line with the liberalization of the economy, the Iranian government introduced some ‘modification’ policies to attract foreign investment in the upstream oil sector. Hence, it is important to examine the structure of the petroleum sector, the transition of the energy sector into the liberalization model, and the political-economic factors involved in the emerging of the IRGC as a central domestic contractor in the oil and gas industry. This issue will be discussed in the next chapter.

***

52 III. POSITION AND DEVELOPMENT OF THE OIL AND GAS INDUSTRY WITHIN THE POLITICAL ECONOMY OF IR

3.1. Introduction Given that oil has continually formed Iranian political-economic developments, the understanding of power structure in Iran is unimaginable without describing and analyzing the energy structure and its transformation in line with changing the political economy of the post-revolutionary era, especially the performing of economic liberalization. Iran is one of the world’s largest oil economies, which means that revenues from fossil fuel resources play a critical role in the political economy of Iran. As estimated, Iran holds the world’s top combined oil and gas reserves. This unique geopolitical position configures the structure of economic and political power in Iran at which competition to control and distribute the existing resources by the state and involved interest groups are reflected in the relation between these actors and the development process of the energy sector over time. Departing from this point of view, the objective of this chapter is to describe the structure of the Iranian oil and gas industry and, more importantly, to analyze the reshaping of this structure as a result of the transformation of the Islamic Republic from state corporatism to the neo-mercantilist developmentalist state, which led gradually to the emerging of the IRGC’s associated companies in this field. To investigate this issue, the following question is central to this chapter: What is the position of the oil and gas industry in Iran’s political economy, and which factors led to the IRGC’s involvement in this industry?

The argument I shall put forward is based on the political and economic structure of the Islamic Republic. Since state corporatism was dominant in the first decade of the post-revolutionary era, the oil and gas industry was centralized and controlled by the state. The necessity of transformation into the neo-mercantilist developmentalist state accompanied by pursuing the neoliberal economic policies from above to achieve two aims. On the one hand, the state pursues to reconstruct the energy industry to attract foreign investment and International Oil Companies (IOC) in the upstream petroleum sector. Simultaneously, the state needs domestic contractors to maintain its control over the development in this area. The emerging of the IRGC’s affiliated companies as dominant actors in this field has to be considered in accordance with the top-down strategy of the state to satisfy its control over the economy at which the IRGC, like other state-linked (semi)private companies, acts as long-arm of the state in this process. On the other hand, in view of the factionalization of the state, the rivalry between political factions and elites has a great impact on the degree of augmenting/diminishing of the involvement of domestic contractors in the industry.

The advanced arguments of this chapter are organized as follows. Section 3.2 focuses on the structure of the energy industry within the Iranian political economy, which covers three aspects: (3.2.1) the size of energy resources in Iran; (3.2.2) share of oil and gas revenues in Iran’s political economy;

53 and (3.2.3) ownership and governance of the Iranian energy sector. Next, section 3.3 presents the transition of the energy sector into the liberalization model generally, and the approach of political factions and elites to the energy industry. This subject includes (3.3.1) necessarily of transformation in the energy sector, (3.3.2) introducing Buy-back Contracts to attract foreign investment, (3.3.3) NIOC’s subsidiaries and their ties with political factions and elites, and (3.3.4) emerging of domestic contractors, among other the IRGC’s affiliated companies, and influence of political factions and elites in the energy sector. Finally, section 3.4 will bring this chapter to the close by a sub-conclusion.

3.2. The structure of the energy industry within the Iranian economy 3.2.1. Oil and gas reserves The nature of oil reserves in the world is a geopolitical issue, which means that global oil and gas reserves are mainly located in the Middle East and the Region (CSR). As shown in Figure 3.1, confirm to current estimates, virtually 80% of the global proven oil reserves are concentrated in the Organization of the Petroleum Exporting Countries (OPEC) member countries, and almost 65% of that is located in the Middle East (OPEC, 2018, 26). Iran’s share of these oil and gas reserves is significantly large. According to the estimation of the World Bank, natural resources shape virtually 60% of total wealth in Iran. Also, oil and natural gas reserves figure 73% of total natural wealth (Karshenas & Malik, 2012, 115). Given the large dependency of Iran’s economy on these reserves, it is important to describe the structure of the Iranian energy industry.

Figure 3.1 World proved crude oil reserves (bn b).

Source: OPEC (2018)

The position of Iran’s energy resources consists of the world’s fourth-largest proven crude oil reserve (see Appendix I). Historically, at the time of the 1979 Revolution, the Iranian crude oil reserves were estimated at 58 billion barrels which were 8% of the global crude oil reserves and 13% of the OPEC. According to the current estimate in 2018, Iran holds 157.2 billion barrels which is almost near to 10% of the global crude oil reserves (EIA, 2019, 4). However, according to the estimate of British Petroleum (BP), Iran's proven oil reserves could equal 158.4 billion barrels in 2015 and 2016 (BP, 2017, 12).

54 The Iranian proven natural gas reserves state, after , at the world’s second-largest place. In 1981, it was estimated at 490 trillion cubic feet (Tcf) - standing at 44% and 16% of the total OPEC and the world’s proven natural gas reserves. According to current estimates, these reserves are 1,191 Tcf which is approximately 17% of the world’s proved natural gas reserves (EIA, 2019, 3). Interestingly, BP has outlined that Iranian natural gas reserves are estimated to total 33.5 trillion cubic meters (Tcm) in 2015 and 2016, which accounts for 18% of the world's total gas reserves, and, hence, is the largest holder of global gas reserves (BP, 2017, 26). In addition, it is estimated that the South Pars gas field, located in the , contains virtually 10% of world gas reserves. The Iranian portion of this gas field is estimated to contain almost 14 Tcm of gas reserves and some 18 bn bl of gas condensates. This amounts to virtually 7.5% of the world gas reserves and approximately half of Iran’s gas reserves (POGC, 2020).

3.2.2. Share of oil and gas revenues in Iran’s political economy The oil and reserves in Iran contribute to the vast proportion of the government's financing. Hence, the dependence of Iran’s political economy on energy resources is always vulnerable to developments surrounding the oil sector which, in turn, have an important impact on macroeconomic policies. Given that the source of the government’s financing mainly depends on oil and gas revenues, the ups and downs of oil and gas production, export, and oil price affected directly the national revenues. According to BP’s estimate, Iranian oil production was equivalent to 5% of the total world oil production in 2016 and was the fourth-largest oil producer. BP also estimated that Iran was in 2016 the third-largest gas producer in the world (BP, 2017). Regarding the domestic consumption, oil and natural gas account for nearly 30% and 67% of the total primary energy consumption in 2016, respectively (EIA, 2018, 2).

As a result of growing Iran’s domestic primary energy consumption, which has increased by about 40% between 2006 and 2016 (see Figure 3.2 and 3.3), the Iranian government has over time subsidized natural gas to reduce and, eventually, replace fuel oil, kerosene, and LPG consumption (, 2017, 73). This policy led to increasing domestic prices for domestic petroleum, natural gas, and electricity between 2010 and 2014 (EIA, 2019, 2). These economic reforms “was to reduce the dependence of current expenditures to oil revenues, financing these costs through nonoil sources such as taxes” (Farzanegan, 2010, 1056).

Figures 3.2 and 3.4 show that the relations between oil production, price changing, and export nearly mimicked the level of government revenues. This observation presents the vulnerability of the government financing condition to unexpected oil revenue shocks by various factors, such as production, changing oil prices, export market, and international developments. As Figure 3.4 traces that, on average, virtually 80% of total Iran’s export and 55% of total government revenues come from petroleum resources.

55 Figure 3.2 The Iranian oil production, export, and consumption during 1973-2017.

Production Export Consumption 7000

6000 The 1979 Revolution

Startting neoliberal economic policies 5000

4000 Iran-Iraq War

3000

2000 Thousand of barrel per day barrel ofThousand

1000

0

Years

Source: CBI (2020), author calculations. Note: Persian calendar years start on surrounding March 20 (e.g. Persian calendar year of 1357 started on 21st March 1978 to 20 March 1979).

Figure 3.3 Iran's gas production, consumption, and export during 1978-2017.

export Domestic consumption Production 160

140

120

100

80

60

40 Billionof CubicMeters

20

0

Years

Source: CBI (2020), author calculations.

56 As presented in Figure 3.4 and 3.5, during the 1979 Revolution, as a result of the impact of labor strikes in the oil industry and disruption of production, the oil revenue declined sharply from $21.7 billion (1978) to $19.2 billion (1979. From then on, oil revenues decrease more from $11.7 billion to $10 billion in 1980 and 1981, respectively. This decline was from 67% to 59% of government revenues. Due to the increase in the , Iran’s oil revenues reached $18,6 billion in 1982 and $20 billion in 1983. Despite this increase, as a result of the Iran-Iraq War, the production and export of oil remain intensely negative compared to the pre-revolution period, which was at the expense of the government’s revenues.

Figure 3.4 Share of oil in total Iranian government’s revenues and total export value during 1979-2017 (in constant price).

oil revenues/total revenues Oil export value/total export value 100,0 90,0 80,0 70,0 60,0 50,0

40,0 Inpercent 30,0 20,0 10,0 0,0

Year Source: CBI (2020), author calculations.

Figure 3.5 Share of total export of Iran and petroleum export during 1979-2017.

Values of total exports Values of petroleum exports 160,000

140,000

120,000

100,000

80,000

60,000

40,000 Value in Billion Billion Dollars Value in 20,000

0,000

Years

Source: OPEC (1999; 2003; 2008; 2013; 2018), author calculations.

57 The significant decrease in oil production and export in the mid-1980s aggravated the economic crisis of the IR. Even with a recovering of the oil production during 1981-89, Iranian oil production was in this period at 40% of the production peak in the 1970s (World Bank, 2007; US.EIA, 2007). During the first decade of the post-revolution, “Tehran struggled to revive production and maintain export as its facilities and transportations corridors were bombed and its economy was subsumed by both sanctions and war mobilization” (Molaney, 2015, 381).

Due to the fact that in this period the government's budget dramatically damaged by declining oil revenues, the state’s financing began to rely more on income taxes (CBI, 2010). In the aftermath of the war, oil production increased significantly from $8.419 million (1988) to $16.831 million (1990), which led to an increase in government revenues in this period, from 38% to 60% of total government revenues (Figure 3.4). As a result of geopolitical tensions between Iran and , the oil price crashed in the mid to late of the 1990s, which led to reducing the government’s oil revenue at the time of economic plan to reconstruct and liberalize Iran’s economy. Consequently, the government’s revenue had fallen by 25% in 1994 compared to the previous year, and 20% lower than the government budgeted (Fürtig, 2002, 235). The oil production hovered around 2.26 million b/d in this period, which is at 40% of the production peak in the 1970s (EIA, 2007). Moreover, the fact that the top-down strategy of economic liberalization since 1989 reliant on oil revenues, due to the collapse of the oil price in 1993 and 1994, the regime faced a balance of payments crisis which limited its economic strategy. Continuity of dependence on oil revenues in the post-war period caused the budget crisis in 1996-1998. This is the outcome of the sharp drop in oil prices in 1998 which caused an urgent economic issue. The 1998 budget’s forecast for oil prices was $16 a barrel. This was revised to $12 in May 1998. In June 1998, however, Iranian crude oil was traded at $9.50 per barrel. In 1998, oil revenues were only $9.9 billion, and, as a result, Khatami was on the brink of economic crisis (Behdad, 2000, 35). Following, a sharp fall in oil prices in this period resulted in decreasing the government’s revenues from 62.6 billion rials (1997) to 53.6 billion rials (1998). However, the dramatic increase in oil prices at the beginning of the 2000s, total revenues of the Khatami’s government significantly rose to more than 100 billion rials. In 2005, the value of petroleum exports accounted for virtually 25% of the GDP and 50% of the government budget (Bina, 2017, 75).

The vulnerability of government budget to oil price swing has severe social consequences. The government’s reliance on petrodollar to finance public expenditure undermines its ability to shelter the economy against a sudden drop in prices, as happened in 2008 when prices dropped from $140 to $40 per barrel in less than six months. For instance, unemployment increased from 9.9% to 15% in 2008 and 2011, respectively (Heuty, 2012, 3). Following, Iran’s revenue from oil and natural gas export has significantly decreased from $55.4 billion in the Fiscal Year (FY) 2014-2015 to $33.6 billion in 2015- 2016 FY (IMF, 2017, 4).

58 Regarding the oil export, GDP growth per capita declined from, on average, 3.5% per year between 1997 and 2004 to 1.5% between 2005 and 2010. Over the same period, oil revenue per capita increased from $345 to $815 (Heuty, 2012, 2). Despite the oil and gas sales supplied 80% of total export and 55% of government revenues, it accounted for solely 15% of Iranian GDP between 2005-2008 (CBI, 2008). The ratio of oil exports to oil production was between 59% and 76% in 1982-2005. Consequently, “there has been well over a 20% proportionate decline in the utilization of oil as a prime source of foreign-exchange earnings in this period. The picture appears gloomier today in this regard since the mid-2000s, given the immediate as well as long-term impacts of the international sanctions and their aftermath” (Bina, 2017, 15). To sum up, cycles in the domestic political economy are directly connected to developments in the petroleum sector.

3.2.3. Ownership and governance of the petroleum sector under state corporatism The Iranian Revolution in 1979 and its political-economic consequences did not lead to a sweeping change but transformed some dimensions of the structure of the ownership and governance of the energy sector. This transformation was primarily at the surface of the sector. Referring to the theoretical model, the passive revolution of 1979 resulted in the maintaining of the previous mode of production with some changes in the cultural and political sphere, which led to the establishment of state corporatism. As an important characteristic feature of state corporatism, the structure of the new political power is reflected among others in the strong intervention of the state in the energy sector after the 1979 Revolution. Under the newly established IR, the state imposes authoritatively upon the industry. Although in the prerevolution regime, the Shah assumed control over the NOIC, which means that the company was solely accountable to the ultimate embodiment of the Shah, the exercise of the right of ownership over Iran’s oil reserves was granted unequivocally to NIOC (Yong, 2013, 7). Following the 1974 Petroleum Act and Risk Service Contracts, NIOC was given unrivaled control over the oil and gas sector:

[T]he Petroleum resources and the Petroleum belong to the Nation. The exercise of sovereignty right of Iranian Nation over the Petroleum resources of Iran with respect to the exploration, development, production, exploitation, and distribution of Petroleum throughout the country and its continental shelf is entrusted exclusively to the National Iranian Oil Company who shall act thereupon directly, or through its agents and contractors (ibid).

After the 1979 Revolution, the nascent postrevolutionary regime annulled the consortium agreement with IOCs [– American and French companies alongside British Petroleum –] and other concessions, consolidating upstream joint venture under NIOC (Maloney, 2015, 374). Instead of destroying the whole structure of the involved institutions of the pre-revolution petroleum sector, the new regime creates new entities to have direct control over the natural resources and to govern and centralize the energy sector from above. At the same time, the basic structure and the relation between the state and the Iranian petroleum sector did not change dramatically. The most significant change was the establishment of the Ministery of Petroleum. The purpose of the Ministry was to govern the four

59 mainly state-owned hydrocarbon companies, including NIOC, the National Iranian Gas Company (NIGC), the National Petrochemical Company (NPC), and the National Iranian Oil Refining and Distribution Company (NIORDC).

Within this framework, NIOC remains largely intact, but NIOC became subordinated to the newly established ministry. The Ministry oversees the strategic direction of NIOC to coordinate its activities with the political-economic strategy of the IR. Consequently, “NIOC took all the reins of the country’s oil operations, and remain the epicenter of the Iranian energy sector, ... remain the fourth largest state oil company in the world, with 180.000 employees as of 2007 – an increase of more than 300 percent since the revolution” (Maloney, 2015, 375). Within the new framework, the role of NIOC was to be responsible for ‘ownership, sovereignty, and management’ in the Iranian upstream oil sector.

Besides establishing the MoP, one of the most significant transformations of the hydrocarbons sector was that Article 81 of the Constitutions prohibits concessions to foreign companies or any individuals. Following this direction, Article 153 forbids “any form of agreement resulting in foreign control over the natural resources, economy, army, or culture of the country” (Guardian Council, 2011). To protect the petroleum sector, the Constitution described among others the energy industry to be ‘publicly owned and administered by the State’. Nevertheless, the destroying of the industry as a result of the Iran-Iraq War and international isolation led the Islamic Republic to adjust some economic and legislative reforms to attract foreign investment and the development of the energy industry.

3.3. Energy industry under neo-mercantilist developmentalist state of Iran 3.3.1. Necessarily of transformation in the energy sector Destroying and impasse of economy, particularly the energy sector during the eight-years war requires a dramatic transformation and reconstruction of the energy industry as the spinal cord of the Iranian economy for the purpose of economic development. The response of the Islamic Republic to this deep economic crisis was a structural transformation to achieve economic growth which is the basic requirement of capitalist economic development. Following the top-down strategy of the neo- mercantilist developmentalist state, Rafsanjani's First Five-Year Plan “provided an important framework within which the government could embark on a program of structural reform and economic liberalization” (Karshenas & Pesaran, 1995, 90). Within this framework, reviving oil production and export was vitally important for financing the ambitious economic liberalization. From this point of view, more importantly, for a resources-rich country such Iran that is strongly dependent on oil and gas revenue and has structure deficiency of domestic capacity and financial resources, developing of the petroleum industry required at least US$ 70 billion solely for the development of the upstream oil and gas sector for a medium-term of 10-15 years (Mirmoezi, 2004). To fulfill this target, the Iranian energy sector has a pressing requirement for attracting external capital and new advanced . Hence, in the early 1990s, Rafsanjani’s government realized the main bottlenecks in the development of the

60 petroleum sector. This process is started under the post-war reconstruction period and continued by Khatami, Ahmadinejad, and Rouhani. As discussed in the preview chapter, based on these principles, the Five-Year Developments Plans during Rafsanjani, Khatami, and Ahmadinejad’s tenure were projected for enhancing the energy sector within the framework of the neoliberal economic policies.

3.3.2. Introducing Buyback Contracts (BBC) and foreign investment As noted before, the following of a ‘dependent development’ policy was for the neo-mercantilist developmentalist state a state-led strategy of economic development form above. Therefore, the reopening of the economy was necessary for a reengagement with the world economy, particularly attracting of IOCs. To realize that, the Iranian government introduced the buyback contracts model as a mechanism for foreign investment into the Iranian energy sector by means Iran can expand its oil production and export. Given that the Constitution prohibits foreign involvement, legislative changes were necessary to make a legal foundation for engaging foreign capital and re-involvement of IOCs in the oil and gas industry. Consequently, during the Rafsanjani and Khatami’s tenure from 1989 until 2005, the Iranian state revealed different models of buyback contracts as the concept of ‘service contracts’ to provide a legal foundation for luring back IOCs. Buyback contracts “are fixed price/fixed return service contracts, where the contractor does not take any ownership of the oil or gas field, and in which an Iranian entity (i.e. NIOC) subcontracts certain aspects of its responsibilities to a foreign party” (Kuhn & Jannatifar, 2012, 213). Theoretically, the introduction of the buyback contract was to ensure the sovereignty of Iran’s state over and ownership of its oil and gas resources. Refer to our theory, the purpose of this model is that the state attempts to combinate its stricter control over access by foreign capital, increases in the rents extracted from resource exports, attracting foreign companies for investment according to state-determined plans.

This new strategy led to internal tension between political factions. Although Rafsanjani and its circle merchant capitalists had overhand over the Iranian economic and political climate, the intensive political rivalry between factions resulted in a cumbersome and unattractive the ‘buyback’ contract in 1990. Despite the internal political restriction and limitation of the first model of buyback contracts, NIOC received legal authorization to employ BBC for exploration, production, and development of the energy industry. Within the framework of the buyback contract regime, NIOC started to attract foreign investment, which resulted in a range of talks with several IOCs over an array of oil and gas projects in order to pull on foreign investment in the upstream petroleum sector. American based Conoco Oil Company signed Iran's first buyback contract in early 1995, but as a result of American sanctions, the Conoco contract was canceled before implementation (Van Groenendaal & Mazraati, 2006, 3711). The other IOCs were among others Total, Chevron, Agrip SpA, National Oil Company, British Petroleum, and the Soviet Machineoxprot (Maloney, 2015, 387).

61 As Figure 3.6 reveals, although the buyback contract law introduced in 1990, the FDI in the form of buyback contracts in the Iranian oil and gas sector started in the early 2000s. This is the impact of the United States (US) embargo whereby a law that passed in 1996 provides for US sanctions against any company investing more than $20 million in Iran (Cammett, et al., 2015, 301). For example, in 2001, Iran signed a deal of $1 billion in 5½-year buyback with Italian company for the development of the Dārkhovin oil field (Bina, 2017, 73). On average, the FDI in the form of buyback contracts contributed to nearly 60% of total FDI in Iran from 1999 to 2017. As demonstrated in Figure 3.6, the total FDI was $15.6 million in 1999, which increased in 2000 significantly. Foreign investment in the form of buyback contract increased to $164,4 million in 2000, which doubled in 2002 by $3.055,3 million. However, as a result of international sanctions which led to the withdrawing of IOCs from the Iranian energy sector, the FDI decreased sharply from approximately $2.456 in 2004 to $778 million in 2007, which was an awkward collapse of virtually 70% for Iran. This trend changed in 2008 by the growth of foreign investment as buyback contracts in the energy sector. It reached its peak in 2012 by $3.466 million. This increase did not remain stable.

Figure 3.6 Total FDI in Iran, including Buy-Back in oil and gas sectors during 1997-2017.

Total Foreign Direct Investment Buy-Back in Oil and Gas Sectors 5.000,0 4.500,0

4.000,0 )

3.500,0 ollars d 3.000,0

illion illion 2.500,0 2.000,0 1.500,0

Value (in (in Value m 1.000,0 500,0 -

Year

Source: CBI (2020), author calculations.

The imposing of economic sanctions by the US in 2011 and the European’s Union decision in 2012 to ban imports of Iranian oil targeted Iran’s energy sector led to a significant decrease in foreign investment in Iran. It crashed to $618 million in 2015 and was approximately an 80% decrease compared to 2012. Iranian FDI in the form of the buyback contract increased by about $503 million in December 2017, compared with an increase of $251 million in the previous year. To sum up, the total amount of foreign investment in oil and gas enhancement projects in the form of buyback contracts between 1999 and 2017 is virtually $30 billion, which is, as noted before, far below what is necessary (US$70 billion) for the development of the energy sector. Overall, Iran was not able to attract the

62 required foreign resources for the development of its energy sector. The sum of foreign investment in the oil sector contributes to almost 0.01% of Iran’s GDP. The impact of US sanctions has been estimated to cost the Iranian welfare to the tune of about 0.11% of Iran’s GDP (Torbat, 2005, 415). Nonetheless, despite the represented amount of attracting foreign investment in the energy sector, the Iranian state has not able to engage advanced technology nor requisite local and foreign capital to fully compensate its underinvestment energy sector to achieve its ambitious production level of 6 million barrels per day in the pre-revolutionary period. The top-down strategy of the state resulted, simultaneously, in the founding of various domestic contractors to realize the foreign investment and continuous state’s intervention in the energy sector.

3.3.3. NIOC’s subsidiaries and their ties with political factions and elites Given the fact that domestic companies were not able to meet the demand for the development of the energy sector and requirement of the opening of the sector to foreign investment, the strong intervention of the state and competition among different political factions and elites was inevitable. In the first instance, the relative autonomy of NIOC’s subsidiary was necessary for encouraging and attracting foreign investment, but they are always reliant on political intervention by the state. The liberalization of the energy sector and attracting foreign investment require the foundation of (semi)private companies in response to the development of the energy industry. This development requires, at the same time, the supervision of the state to control the economic development process. Departing from this paradigm, as a consequence of the economic liberalization policy during the Rafsanjani and, particularly, Khatami’s tenure in the energy sector, a lot of (semi)private companies were created to arrange an effective attracting foreign investment at which the commercial bourgeoisie played a significant role.

More concretely, discovering of the mega Gas Field of South Pars in the Persian Gulf in 1991 by the National Iranian Offshore Oil company (NIOOC), which is approximately half of Iran’s gas reserves, was accompanied by the creation of commercial spinoffs of NIOC for purpose of expanding the Iranian gas export. The controlling over South Pars has been a competition field for many new private companies, commercial capitalists, elites, and political factions towards the distribution of this giant spoil. Hence, the idea of establishing (semi)private companies came up to remove constitutional restrictions. During this time, at least ‘one hundred affiliated and subsidiary companies’ were established (Zahirinejaad, 2012, 237). The most important subsidiaries are Oil Industries Engineering and Construction (OIEC), Iranian Offshore Engineering and Construction Company (IOEC), Petroleum Engineering and Development Company (PEDC), Petro-Iran Development Company (PEDC), Naftiran Intertrade Company (NICO), Pars Oil and Gas Company (POGC), and Petropars (see Table 3.1). These companies as (semi)private subsidiaries were involved direct and indirect, in partnership with foreign firms, with almost all the projects in the Iranian oil and gas industry. These companies were registered outside of Iranian termitarium at which they were not subject to Iranian low and their incomes were not taxable by the state.

63

Table 3.1 NIOC's subsidiaries in the Iranian energy industry

Spinoff Established Main Activities companies

OIEC 1987 A leading private, EPC contractor, partnered with British Gas on a bid for South Phases 9 and 10 and 11 and 12 (OIEC, 2020). NICO 1991 Registered in Jersey Channel Island (United Kingdom) for developing international trade network activities and attract foreign investment (Naftiran, 2020), as one of the key instruments for the commercial activities of NIOC at the international level. Over time, NICI became an integral link in Iran’s burgeoning system – the $3 billion credit facility negotiated during the Khatami era, for example, utilized NICO as the conduit (Maloney, 2015, 396). IOEC 1993 To fabricate and install production facilities necessary for the oil and gas industry, evolving into an engineering subcontractor and holding firm for other small technical firms. Today through its rapid expansion and achievements, IOEC has evolved into an oil and gas EPCIC contractor operating at national and international levels (IOEC, 2020). PEDEC 1994 Incorporated in in the Channel Island to serve as the main domestic partner for buyback projects. PEDCO 1996 Registered in Jersey as a general contractor for the purpose of operating the development of oil and gas fields. POGC 1998 Registered in the Virgin Island to develop the South Pars gas field and respectively. Decisiveness of the MoP to uphold and exploit the Islamic Republic of Iran rights in the South Pars gas field led to the establishment of POGC. Petropars 1998 Petropars, registered in England, is established to act as the key supervisor for subcontractors in Iran’s natural gas sector. As noted in its website, Petropars intended to become an Exploration & Production (E&P) Company at the international level, seeking new opportunities for development in Iran and other countries in partnership with reputable International Oil Companies in the world. Its original shareholders were the NIOC Pension Fund (60%) and the Industrial Development and Renovation Organization Pension Funds (40%) (Petropars, 2020).

64 The liberalization of the oil and gas industry, parallel to the abundance of energy resources in Iran, generates fertile ground for the NIOC spin-off companies and the coalition between commercial capitalist and political factions to capture these resources. Legally, these newly subsidiary companies had more space and autonomy to operate in the energy sector with little state supervision. NICO and its newly established subsidiaries have been one part of the liberalization of Iran’s economy. At the same time, although the subsidiaries were (semi)private entities, they maintain a strong connection with NIOC and the state. Their purpose was and, still, is to attain new requirements for the development of the energy sector.

As Harik (1992) highlighted, as a result of economic liberalization, for NIOC was a ‘commercial goals within the purview of the state’. It means that NIOC has to pursue a profit-seeking strategy. From this perspective, Namdar Zanganeh, minister of oil, declared that he supports “ and autonomy for various companies and better performance. I believe that all units of NIOC … should operate strictly on economic and commercial terms. They should also make profit on their own” (MEES, 1997, 40-49; in Mahdavi, 2011, 266). The commercial independence of these companies generates a circumstance that enables them to tender for buyback contracts in partnership with IOCs. “Through its foreign-registered subsidiaries, NIOC had found a means of bypassing the constitutional restrictions on foreign financing of oil projects, effectively entering into contractual arrangements with companies in which it retained complete control” (Yong, 2013, 10).

3.3.4. Contractors and influence of political factions and elites in the energy sector In spite of that the NIOC’s subsidiaries have some degree of autonomy as (semi)private companies, they remain strong ties with political factions and the state has ongoing control over them. This has to do with the fact that the domestic private sector was not strong and organized enough to handle by itself. Given Iran's limited capability to mobilize the domestic social forces and engaging financial resources, the reconstruction of the energy sector required the constant intervention of the state to manage the development process in this industry. Referring to the theoretical framework, the strong involvement of political factions in the energy sector has been a principal feature of a state-led strategy of economic development during the transformation of the Islamic Republic to a neo-mercantilist developmentalist state whereby the relation between the state and NIOC and its subsidiaries (as semiprivate commercial companies) has been a necessary factor for the domination of the state over the society, in this aspect in the especially the energy sector. In this sense, “NIOC could only pursue its strategy of cultivating subsidiaries while the informal ties that bound it to its political backers held sufficiently firmly to resist the challenged of rival suitors” (Yong, 2013, 11). As expected, this situation creates a suitable condition under which an intensive rival power position within the state, the unwise intervention of political faction in economic investment, and increasing corruption in different areas. Consequently, commercial capitalists, regime-affiliated elites, parastatal foundations, and military institutions became the main winners of the new economic reforms.

65 For instance, in the later 1990s, Mehdi Hashemi, son of then-President Ali Akbar Hashemi Rafsanjani, assumed an important position in the Petroleum Ministry and subsidiary companies. Hashemi headed PEDEC as the development arm of NIOC, one of the main domestic partners for buyback projects in the energy industry. His goal eventually was to control the company for the suit of economic and political influence in the country. In addition, Hashemi has been the chairman of IOEC in the 1990s. Not surprisingly that IOEC act as a partner to PEDEC (Maloney, 2015, 395). He was also the chairman of the Iranian Fuel Consumption Optimizing Organization (IFCOO), one of the NIOC’s subsidiary. Hashemi “was revealed in the trial of Statoil executives who were found to have paid him bribes in 2002 and 2003 though UK-registered intermediary companies that he owned, in order to secure contracts” (Yong, 2013, 12).

Later in the Khatami’s tenure, Mehedi Husayni, a deputy minister, has been the head of PEDEC. Husayni was known as ‘Mr. Buyback’ for his role in devising the contract model and negotiating many of the early deals. By 2000, he is replaced by Mehdi Mirmoezzi, also as a deputy minister (Maloney, 2015, 394). Although PEDEC was engaged with developing the megaproject of South Pars, as a result of its inability to attract financial resources, the project was shifted to the newly established Petropars as a semiprivate NIOC’s spin-off company. Petropars is gradually engaged with phases 1 (1998), 4, and 5 (2000) of the South Pars. Also, in cooperation with internationally accredited companies, Petropars was able to transfer the necessary management and technical knowledge to the country. Moreover, it was responsible for the implementation and development of Phases 6, 7, 8 (2000), 12 (2005) of South Pars in 2000. Petropars added the development of Phase 19 of South Pars and Farzad Gas Field, North Cabinda to its agenda (Petropars, 2020). Throughout its history, Petropars has been implicated in a series of scandals and allegations of corruption. Because of political pressures, Petropars chairman, Behzad Nabavi, a close ally of then-President Khatami, were eventually forced to resign in 2001. Finally, Bijan Zanganeh, the Minister of Petroleum during Khatami’s administration, brought the company entirely under the supervision of the government by arranging for NIOC to purchase shares held by the NIOC Pension funds (Yong, 2013, 11-12). Alongside some changing the prominent figures, the performance and structure of the company remain the same, besides delaying of South Pars' development. Given this close relationship between the state and NIOC’s subsidiaries, it is not surprising that the status of Petropars confused the international observers. They indicated that Petropars “acts as a private company, although it is controlled by the government, as well as that of other entities which were little more than shadow subsidiaries without any real staff or capabilities” (Energy Compass, 2001).

Furthermore, PEDCO as a subsidiary of NIOC, “emerged as a major player quickly when it won buyback contracts for the Salman field (with IOEC)” (Maloney, 2015, 396). PEDCO headed by Mostafa Khoei, the former chief of NIOC’s offshore subsidiary. Khoei pursued to commercialize and engage international companies throughout the Khatami’s presidency but was dismissed in 2007 after the

66 election of Ahmadinejad as President (Yong, 2013,13). By 2003, NIOC decided to transfer all shares of PEDCO to Naftiran Intertrade Company. Following, in 2016, PEDCO was approved by the MoP as a qualified E&P company to join a partnership with IOC in developing oil and gas projects (PEDCO, 2020). Political rivalry around this company emerged at the time of the development of the Salman oil field. By 1998, during Khatami’s presidency, PEDCO was responsible for developing the field. Although the reformist faction claimed for political ascendancy, they denied publishing the detail of the contract between PEDCO and UAE-based Crescent Petroleum. When Ahmadinejad came to power in 2005, its allies brought the deal to the light and attacked it on the grounds that unprocessed gas was to be sold cheaply (Yong, 2013, 12). Since the government had the plan to privatize PEDCO in 2007, Dana Energy a private firm was the successful bidder, because Mostafa Khoei, the former CEO of PEDCO, was the head of Dana Energy.

During the presidency of Khatami, OIEC was initially chaired by Ali Hashemi, who later chaired the parliament’s Energy Commission. In 1999, the former construction minister Kholamreza Forouzesh took the helm and later acquired a 10% interest in the Soroush/Nowruz field development (Maloney, 2015, 396). POGC is another NIOC’s subsidiary and engaged to the development of the South Pars, and North Pars gas field. “The South Pars project made POGC a powerful and profitable empire, which was held firmly within the NIOC family thanks to a controlling stake held by the NIOC Pension fund, a parastatal investment fund controlled by NIOC management” (Yong, 2013, 10).

The rivalry between political factions has intensified during the whole process of economic liberalization. The large IRGC’s affiliated company, Gharagah Sazandegi Khatam ol-Anbia (the Khatam al-Anbia Construction Headquarter), which involved with the economic activity since the ‘reconstruction era’ during Rafsani’s tenure (see chapter IV), expanded its activities to the oil and gas industry. By 2005, two IRGC’s associated companies, SADRA and Khatam al-Anbia attempted to have access in the upstream petroleum sector but their contract was canceled by Zanganeh, the Petroleum Minister in the Khatami’s tenure and a close Rafsanjani ally. Furthermore, during the second Khatami’s tenure, Zanganeh prevented MJF to penetrate the development projects of the South Pars gas field (APS, 2001, 16).

Despite that, after the victory of Ahmadinejad in the 2005 presidential elections, Khatam al-Anbia received a no-bid contract to develop phases 15 and 16 of South Pars Gas Field with a worth of $2.7 billion. The contract was signed in July 2006 between the National Iranian Oil Company and the Khatam al-Anbia - contractor dry sector - and Iranian Offshore Engineering and Construction Company (IOEC) - contractor maritime sector (Fars News Agency, 2007; Tasnim News Agency, 2014). From then on, Khatam al-Anbia has gradually become one of the largest – or the largest - contractors, which is currently operating in the country's oil and gas industry in several fields of upstream and downstream projects, namely field development, refining industries, oil and gas storage , and oil and gas

67 transmission pipelines (Khatam, 2020a). As mentioned in the introduction, nominated as one of the Iranian companies in 2016 to operate in the form of E&P companies, Khatam al-Anbia has recognized as a company that is authorized for international cooperation in the energy sector (ISNA, 2016). This trend has been continued so that IRGC has become the most influential player in the oil and gas industry.

The shift from a centralized system to the involvement of several (semi)private and parastatal contractors in the energy sector is better understood as a top-down strategy of the neo-mercantilist developmentalist state pursuing the trend towards the liberalization of this sector, alongside the close control of the state in this field partially through a new set of domestic contractors, particularly large companies associated with the IRGC. The latter is also influenced by the intervention of the political. The strong ties between political factions and commercial capitalists that attempted to control the energy sector enable subsidiary companies to repulse their rivalries.

3.4. Conclusion This chapter aimed to investigate the structure of the Iranian oil and gas industry in the post- revolutionary era, the position of this sector in the political economy of Iran, and the reconstruction of the sector under the neo-mercantilist developmentalist state (since 1989). This objective has been examined by the question of ‘what the position of the oil and gas industry in Iran’s political economy is, and which factors led to the IRGC’s involvement in this industry’.

As we have been demonstrated, Iran holds the world’s fourth-largest proven crude oil reserve, and the world’s second-largest natural gas reserve. Having such a geopolitical position, the oil revenues account for virtually 80% of total Iran’s export, and 55% of total government revenues in the post- revolutionary era. This condition makes the government’s revenues vulnerable to various internal and external factors surrounding oil production, oil price fluctuations, export market, and international developments. Following these factors, we have seen how the economic program of the governments was dependent significantly on oil revenues.

The chapter has also presented that there was not a perceptible change in the relation between the state and the petroleum sector under the IR, which confirmed our theoretical approach that the passive revolution of 1979 in Iran that resulted in establishing the Islamic Republic as state corporatism, the older social order remained intact on a large scale, except some changing in the surface of the political power. Nevertheless, a mounting economic crisis forced the Islamic Republic to adapt several reforms in the petroleum sector to attract foreign investment.

The results demonstrated that the neo-mercantilist developmentalist state of Iran has been pursuing a top-down strategy by making it legally possible to pull on the involvement of IOCs in the upstream petroleum sector and developing this industry. This strategy coincided with the foundation of the bulk of domestic contractors in this field. These factors created a fertile ground for the involvement of several

68 commercial capitalists, elites, and political factions in the oil and gas development projects. In the meantime, the IRGC’s affiliated companies expanded their activities to the oil and gas industry and have become, especially during Ahmadinejad’s presidency, a dominant player in this field.

To bring this chapter to a close, we may come to the conclusion that the transformation of the political economy of Iran from state corporatism to the neo-mercantilist developmentalist state required the further integration of the Iranian economy, among other the petroleum sector, in the world economy, as a ‘dependent development’ strategy, to realize the development of this industry which is of crucial importance for the ambitious policy of the Iranian bourgeoisie and the Islamic Republic to accomplish its goal. However, this strategy needed, simultaneous, the strict intervention of the state in this area, particularly by the (semi)private subsidiaries, and affiliated companies of parastatal and military institutions. These factors brought us to the conclusion that the understanding of the IRGC’s evolution from a military institution to a determinant player in the economy required making a connection between this development and the transformation of the political economy in the post-revolutionary time. Hence, it is necessary to investigate the size and scope of the IRGC’s activities in the oil and gas industry. This will be presented in the next chapter.

***

69 [This page is intentionally left blank]

70 IV. THE IRGC’S INVOLVEMENT IN THE IRANIAN OIL AND GAS INDUSTRY

4.1. Introduction As has been pinpointed in the previous chapters, the involvement of the IRGC in the economy is the outcome of the various political and economic mechanisms related to the Iranian political economy since the launching of the neoliberal economic policies. Having this background in the mind, the purpose of the chapter is to identify the role of the IRGC as a dominant contractor in the oil and gas industry. Summarising once again briefly, established soon after the 1979 revolution as a military entity, the IRGC expanded noticeably its activities into the economic area Hence, this chapter contains two objectives: Firstly, the historical development process of the IRGC’s involvement in the various economic fields from 1989 until nowadays. The second point is to present and analyze the IRGC’s involvement in the oil and gas industry and, thirdly, the role of political factions in augmenting/diminution the IRGC’s engagement in this industry. To achieve this objective, the central question to this chapter is the following: To what extent the IRGC has become a central player in the Iranian oil and gas industry?

To present this development process, the structure of this chapter is the following. Section 4.2 traces an overview of the expanding dimensions of the IRGC’s function into a business conglomerate actor under the policies of the Iranian neo-mercantilist developmentalist state. The state needs the IRGC and its associated companies to participate in the economy and act as the reliable instrument of the state to secure the state’s power over the economy. Of course, this process has been affected by the competition among political factions. This dimension is important to understand the historical background of the IRGC’s involvement in the economic fields. Section 4.3 will be profoundly devoted to the enter and consolidation of the IRGC in the oil and gas industry, with concentrating on (4.3.1) the beginning of the IRGC’s access to this industry, (4.3.2) Khatam al-Anbia’s activities in oil, gas, petrochemical areas, (4.3.3) the development of the IRGC’s involvement in this area during the presidential terms (2000- 2019) to examine and analyze the influence of the political factions in this process. Finally, section 4.4 will bring this chapter to an end with a conclusion.

4.2. The development of the IRGC’s involvement in the Iranian economy As demonstrated in the previous chapters, the structural transformation of the Islamic Republic into the neo-mercantilist developmentalist state creates a fertile ground for the IRGC’s involvement in economic activities. When the state decided to implement a range of economic reforms to encourage the neoliberal economic policies for the purposing of removing obstacles on the way of Iran’s economic development, the role of parastatal foundations and IRGC has become necessary for the top-down strategy of the state to have close supervision over this process.

71 4.2.1. Background of the IRGC’s entry into Iran’s post-war economy The prominent presence of the IRGC in the economy is neither surprising nor new. The role of armed forces in the consolidation of the Islamic Republic and their participation in economic development has represented a significant priority for all political factions during the post-revolutionary era. As noted before, the original involvement of the IRGC is rooted in the post-war transformation period of Iran’s economy under President Rafsanjani (1989-1997) into the liberalization of the economy, and “has since expanded to incorporate hundreds of subsidiaries” (Maloney, 2015, 342). On the one hand, given the weakness of domestic economic capacity, especially the private sector, Rafsanjani engaged various parastatal institutions to participate in the development of Iran’s economy. On the other hand, the cartel’s characteristic of the Iranian state, the factionalization of the state, accelerated the increasing role of the IRGC in the economy.

Developing its capacity and expertise in the Iran-Iraq War, the IRGC has also established some economic institutions to adapt itself to the new conditions and participate in economic and political developments as a lever in the hands of the state. Adapting this direction, the IRGC established the Cooperative Foundation of the Sepah (-e Ta‘avon-e Sepah) in 1989 and the Cooperative Foundation of the Basij (Bonyad-e Ta‘avon-e Basij) (Forozan, 2013, 203). The Cooperative Foundation of the Sepah is active in several commercial companies in construction, , banking (like Ansar Bank), and auto industry (the and Saipa). Then, on 18 December 1989, the IRGC founded Gharargah-e Sazandegi-e Khatam-al-Anbia (The Khatam-al-Anbia Construction Headquarters), also known as Khatam al-Anbia, by order of the Commander in Chief of the Armed Forces, , and the request of the Rafsanjani’s administration, to take part in the country’s reconstruction (Donya-e Eqtesad, 2020a).

Khatam al-Anbia is considered a subdivision of the IRGC and its commander is appointed by the commander-in-chief of the IRGC. According to Sardar Abdullahi, the previous commander of Khatam al-Anbia, the institution has 170.000 manpower and 5.000 private sector contractors working with the IRGC (Khatam, 2017). Therefore, Khatam al-Anbia as the most important economic arm of the IRGC entered the construction field with the implementation of major projects in various fields such as dams, roads and runways, construction, irrigation and drainage, long tunnels, water transmission pipeline, oil and gas, ports and offshore structures, and sea and land drilling (ibid). Donya-e Eqtesad, the Iranian newspaper, divides the development process of Khatam al-Anbia into four stages, namely (1) reconstruction stage, (2) construction stage, (3) breaking monopolization stage (4), modeling stage (Donya-e Eqtesad, 2020b).

At the first stage, under Rafsanjani’s presidency (1989-1997), Khatam al-Anbia undertook in the reconstruction projects as the beginning of its involvement in economic activities. During this period, Rafsanjani not only allocated a large amount of money to reinforce the IRGC's military strength but

72 also gave large projects such as the Karkheh Dam and the Saveh Highway to the IRGC without formalities or tenders. In the second stage of its life, during Khatami’s tenure (1997–2005), the company entered the field of construction and implementation of public projects in various development and industrial fields. In this period, Khatam al-Anbia was organizing the headquarters and executive units and related institutions and focused on the structure of the proximity command (Donya-e Eqtesad, 2020c). Over time, Khatam al-Anbia established several subsidiary companies involved in agriculture, industry, , road building, transportation, import, export, education, culture, and the oil and gas sector, and has become one of Iran’s largest contractors in industrial and development projects, and today is considered the IRGC’s major engineering arm (Wehrey et.al., 2009, 60). In its third stage, as a result of international sanctions, when the majority of foreign companies and contractors were forced to abandon the implementation of infrastructure projects, realizing this, Khatam al-Anbia attempted to move from public projects to mega-projects that were previously carried out by foreign companies (Donya-e Eqtesad, 2020c). Only during the 11th government, under the presidency of Rouhani, Khatam al-Annbia completed 183 construction and industrial projects, including transportation, oil and gas, dam construction, industry and mining, and information technology (Khatam, 2017).

As noted in its own Web site, the main fields of Khatam al-Anbia’s activities are (a) oil, gas, and petrochemical, (b) construction, mining, and industry, (c) agriculture and poverty alleviation. Under these fields, there are various sub-fields where Khatam al-Anbia as a multilayered institution is active, including power plant, pier and ports, offshore structures, transport, mining and mining industries, information communication technology (ICT), consulting, financing, research and engineering services (Khatam, 2020a; Donya-e Eqtesad, 2020c). As reported, Khatam al-Anbia has been awarded in excess of 1.800 important and infrastructure projects in various fields over its entire life span (Khatam, 2020a). Furthermore, according to Haj Rasouliha, CEO of Iran Water Resources Management Company, it is estimated that from the total 182 dams built by the Ministry of Energy, 62 have been built by Khatam al-Anbia and its affiliates, which is approximately 35% of all dams are built across the country. Moreover, he pointed out that about 22 of the 100 active dams in the country are on the agenda by Khatam al-Anbia’s contractors, either as part of the work or mainly the whole project by its institutions and subsidiary companies, such as Be’sat, Ashura, Amin, Fajr, Javadalaimeh, Spa Sad, Sarollah, Imam Ali, Fatir, etc. are running (Donya-e Eqtesad, 2020d). At the same time, Saeed Mohammad, commander of Khatam al-Anbia, claimed that 55% of the country's dams and water reservoirs were built by Khatam al-Anbia (Donya-e Eqtesad, 2020e). Also, in February 2020, he announced that the organization has built 4.000 km of railways, which is 35% of the country's railways and 60% of the subways in different cities across the country (PANA, 2020).

Iranian Economy (2012) reported that although no exact figures have been released on the IRGC's presence in Iran's economy, preliminary estimates suggest that the government has provided 11.000 construction projects to the IRGC over the past seven years (2005-2012). It is also estimated that IRGC

73 has 812 registered companies. These companies have 1.700 government contracts for civil engineering activities. The IRGC and Basij have three affiliated banks, including Ansar, Mehr Banks, and Samen al-A'emmeh Credit Cooperative. Simultaneously, the IRGC has shares in (affiliated to the Martyr Foundation), Ayandeh Financial and Credit Institution (affiliated to the Foundation for the Oppressed and Veterans), Pasargard Bank, and the Financial and Credit Institution. More interesting, for the first time, Mahmoud Ahmadinejad took issue with the informal and economic activities of the IRGC. He raised the issue of unauthorized docks and said that the IRGC had commercial docks (ibid).

4.3. The IRGC’s involvement in the oil and gas industry One of the most important targeted areas of the Khatam al-Anbia’s economic activities is ‘oil, gas, and .’ Khatam al-Anbia indicates that in the light of the fact that “most of the country's income came from the production and sale of crude oil and its main contractors were foreign companies, and the presence of Iranian companies in the management, engineering, and implementation of oil and gas projects was very low, [...] therefore, since 1999, the Khatam al-Anbia Construction Headquarter has decided to enter the field of oil, gas, and petrochemical contracting. Now, Khatam al-Anbia, “is known as the largest contractor with the leadership, management, engineering design and indigenous launch of the country's oil and gas industry” (Khatam, 2020a). During its increasing activities in this area, Khatam al-Anbia has become one of the largest – or the largest - contractors, which is currently operating in the country's oil and gas industry. As mentioned before, in 2016, the company was nominated as one of the Iranian companies to operate in the form of E&P companies to operate in the area of international cooperation in the energy sector (ISNA, 2016). One of the other powerful contractors in the oil and gas sector is the consortium of Khatam al-Awsiya which was made up of several large Iranian companies - including Khatam al-Anbia as the main shareholder, Oil Industry Engineering Company (OIEC), Iranian Offshore Engineering Construction Company (IOEC), ISOICO, and SADRA) - by the order of Massoud Mirkazemi, the Minister of Petroleum in the second term of Ahmadinejad’s administration, in 2010. The purpose of this establishment was to replace the British- Dutch company and the Spanish company by signing a contract worth approximately $5 billion in phases 13 and 14 of the South Pars projects (Dana News Agency, 2014). According to Abdul Reza Abed, the then-commander of Khatam al-Anbia, the first contractor that entered Assaluyeh and South Pars was Khatam al-Anbia. The state that the water intake which is currently in operation for all phases was built by Khatam al-Anbia (Zandi, 2006).

74 4.3.1. Khatam al-Anbia’s activities in oil, gas, petrochemical areas The targeted section of ‘oil, gas, and petrochemicals’ include four sub-areas in several fields of upstream and downstream projects, namely (I) developing of fields, (II) refining industries, (III) oil and gas storage tanks, and (IV) oil and gas transmission pipelines. As shown in Figure 4.1, the total value of contracts in sub-area of ‘developing of fields’ is $232 million which is 1% of the total contracts’ value, while the total amount of ‘refining industries’ contracts’ value is nearly $27 billion that is the largest section (61%). In comparison, the total contracts’ value in the area of ‘oil and gas transmission pipelines’ is more than twice as big as the value of the section ‘oil and gas storage tanks’, which is virtually $12 billion and $5 billion (27% and 11%) respectively. In addition, these combinations and ratios are reflected in the number of awarded contracts per each sub-area. As has been demonstrated in Table 4.1, there are only six projects (being) implemented in the sector ‘developing of fields.’ By contrast, there were awarded seven projects in ‘oil and gas storage tanks’, sixteen projects in ‘refining industries’, and twenty projects in the area of ‘oil and gas transmission pipelines to the IRGC’s affiliated companies.

Figure 4.1 The total value and ratio of the oil, gas, and petrochemical contracts awarded to the IRGC’s associated companies per sub-area.

) $26.978

dollars 1%

illion 27%

m n n

$12.256 area (i area - 61% $5.091 11%

$232

Fields development Total value per sub per value Total Refining Industry Fields development Refining industry oil and gas storage tanks oil and gas storage tanks Oil and gas pipelines Oil and gas Pipelines

Source: data is collected from various primary sources that were presented in the section 4.3.1.1; 4.3.1.2; 4.3.1.3; 4.3.1.4, (author calculation).

75 Table 4.1 The awarded contracts to the IRGC’s affiliated companies in the area of oil, gas, and petrochemical (I) per each presidential term and (2) per sub- eras (1996-2019).

SUB-AREAS

**

erm

T

ollars*

d

Projects n

Year

inister of inister

ields

illio

Petroleum

M

F

m

Industry

Refining Refining

Oil & gas & Oil

Pipelines

reservoirs

Oil and Gas Gas and Oil

Presidential Presidential

In In

Developing of of Developing

Type of contract of Type

1996 New pump houses of the Rey- crude oil pipeline - *** - ×

05) 2003 New pump houses of the Rey-Tabriz crude oil pipeline 25 EPC × - 2004 6 oil storage tanks in the region 18 EPC ×

2004 Construction of Tehran's fifth gas transmission pipeline (2nd part of the first phase) 0,008 PC ×

Khatami Zanganeh (2001 43 - 2006 Phases 15 and 16 of South Pars Gas Development 2.720 EPPS ×

2006 The 1st phase of the seventh nationwide pipeline (Peace) 1.300 EPC ×

2006 the Sarakhs to Dargaz gas pipeline 45 - ×

09) 2006 Hamedan-Bijar gas pipeline 180 PC × – 2007 Early Production of Kish Gas Field 50 EPCF ×

Hamaneh 2007 Building the LPG and LNG reservoir for Phase 12 of South Pars 500 - × (2005

2007 LNG and LPG double-walled tanks 332 - × K.V. 2007 Saveh-Qazvin-Koohin gas transmission pipeline 310 PC × 2007 Mahshahr Export Port Organization Project (Dry and see section) 150 EPC × 2008 Shahid Chamran pump house of 345 IPC × 2008 The 2nd Khorramabad-Kuhdasht gas pipeline 275 PC × 2008 Water intake project of Gulf Star Gas Condensate Refinery (by SADRA COMPANY) 130 - × 2009 3D seismic project of Bande Karkheh oil field 72 - × 2009 2 propane and two butane tanks for phases 6 and 10 of SP 60 - × term term Ahmadinejad of th

st 2009 The 10 national pipeline (Patawe - Pol-e-Kaleh) 700 PC × 1 G. Nozari H. 7.169

76 2010 Phases 22, 23 & 24 of South Pars Gas Development 6.000 EPPS ×

2010 Construction of facilities of Urea and Ammonia Complex of Pardis Petrochemical 600 - ×

2010 Phases 13 & 14 of South Pars Gas Development 5.000 EPPS ×

2010 Sousangard oil field development project 500 EPCF ×

2010 2nd phase of the Ilam Gas Refinery Development Project 150 - × 2010 2nd phase of the 7th national pipeline ('s gas pipeline) 250 EPCF × 2010 The third section of the 6th gas pipeline 1.300 EPCF ×

2010 the oil pipeline from the Abadan-Arak-Rey 1.300 EPCF ×

M. M. Mirkazemi 2010 Construction of 3 oil pipelines in Khorasan, Kerman, and Hormozgan provinces 850 EPCF × 13)

– 2010 Neka-Jask oil pipeline (North to South of Iran) 3.000 - × 2010 the Saveh-Qazvin- Koohin gas pipeline 0,30 - × 2010 Construction of Sabzab-Tang Fani-Shazand-Rey crude oil pipeline 1.300 EPCF × 2011 Development of Halgan and Sefid Baghun gas fields 970 EPCF × 2011 Construction plan of Star Persian Gulf condensate refinery 3.500 - × 2011 Design and construction of underground oil and crude reservoir tanks 2 - × 2011 4 one-million-barrels of oil storage in 39 EPC × 2011 the construction of a pipeline between Ethan and 500 - × 2011 3th and 4th gas pressure boosting facilities (Khormuj and Deylam) 16 EPC × 2012 2D & 3D seismic project of Timab (Ilam) 0,218 - ×

term term Ahmadinejad of (2009 2012 Development of the Tusan and Alpha oil fields 850 - ×

nd nd R. Ghasemi

2 2013 New Gachsaran gas injection station 85 - × 2013 3200 (NGL) of 1.500 EPCF × 2013 Development of the Somar oil field 68 EPCF ×

27.781 - Central Ethylene line program of 4 petrochemical projects in Jahrom, Firoozabad, ×

2014 1.300 EPC

Darab, and Fasa

)

9 2014 Construction of Abadan-Ahvaz-Arak-Tehran pipeline 350 - ×

1

Rouhani

– 2014 Construction of water pipeline from Behmanshir river to 300 - ×

nd 2016 The heating system plan of Mahshahr furnace oil storage facility, 4.140 EPC × 013

B, B, Zangeneh 2018 3D seismic project of Paniz 75 - × (2

and 2 2019 Construction of Petro Anahita in Kermanshah 3.400 - ×

st

1

9.565 -

Source: Data was collected from various primary sources as presented in the following sections (4.3.11; 4.3.1.2; 4.3.1.3; 4.3.1.4), author calculation. Notes:

77 * I have changed the original value of contracts and in Iranian Rials and Toman to Dollar, which is conducted based on the exchange rate price in the starting year of contracts using this website (www.xe.com).

** Types of contracts

• E: Engineering (Contracts that cover only the design phase of the project). • EP: Engineering &Procurement (Contracts that include the design and supply of products phase of a project product). • PC: Procurement, Construction (Projects that require the contractor to purchase and build). • EPC: Engineering, Procurement, Construction (In this method, engineering, procurement, supply and execution operations are performed in parallel and in the form of a contract). • EPCF: Engineering, Procurement, Construction, and Financing. • EPCF: Engineering, Procurement, Construction, Finance. • EPPS: Engineering, Procurement, Production, Schedule (IRNA, 2017; Norsun Energy).

*** data is not available

78 4.3.1.1. Development of fields In the area of ‘developing of fields’, the CV of Khatam al-Anbia shows that its most important projects completed are (I) implementation of seismic operations in Azadegan North oil field in the in 1996;1 (II) the final design of three‐dimensional (3D) seismic data collection operations in Bandar Karkheh oil field, located in 20 km northwest of Ahvaz, with the value of 700 billion rials (equivalent to approximately $72 million) (SHANA, 2009a; PEDEC, 2013); (III) the processing of 3D seismic data for Timab oil field, located in the Ilam province. The credit for this project was 164.000 rials (about $218.000) (ISNA, 2012a); and (IV) the construction of a new Gachsaran gas injection station, located in the Kohgiluyeh and Boyer-Ahmad province, is also the most important project being implemented by Khatam al-Anbia. For the implementation of this project, 2.356 billion rials (nearly $85 million) of credit has been allocated (Mehr News Agency, 2013). (V) Moreover, in 2016, the study of Azadegan South, Mansouri, Aab-Teymour, and Farzad A&B oil and gas fields was assigned to Negin Afagh Kish Oil and Energy Development Company (TENCO), a subsidiary of Khatam al-Anbia (IRNA, 2016 SHANA, 2019b). (VI) The exploration of Paniz 3D seismic project has been carried out in , Abadan, Mahshahr and Darkhovin counties with a credit allocation of about 3.000 billion rials ($75 million) for 32 months by TENCO, a Khatam al-Anbia’s subsidiary (NIOC, 2019).

4.3.1.2. Refining Industry In the field of ‘refining industry’, hitherto, Khatam al-Anbia has completed the following main projects. (I) New crude oil pumping stations of the Rey-Tabriz crude oil pipeline at a cost of nearly 200 billion rials (nearly $25 million) (SHANA, 2008); (II) the contract for the development of phases 15 and 16 of South Pars worth $2.720 million and was signed in July 2006 (Fars News Agency, 2007; Keyhan, 2015; Tasnim News Agency, 2014). Reza Forouzeh, the executor of phases 15 and 16 of the South Pars development project, stated that based on the initial contract, the cost was supposed to be $3 billion, but due to the international sanctions and lack of integrated management, we have spent $6 billion on this project. And although the project was scheduled to be operational within 52 months, it was put into operation in 104 months (ILNA, 2015). (III) The other project was the Shahid Chamran pumping station of Ahvaz that was built by one of the subsidiaries of Khatam-al-Anbia for purpose of creating more stability in the crude oil transfer system on the Ahvaz-Rey route with a capital of more than 38,8 billion tomans (almost $345 million) (PEDEC, 2012a; YJC, 2012b; SHANA, 2012a).

(IV) The Persian Gulf Star Refinery, as the world's largest gas-condensate refinery and the world's largest producer of 5 gasoline, is one of Khatam's most important projects. The development of this project began in 2006. After many ups and downs surrounding the development of this project and the departure of Progetti and Golden Group companies in February 2010, Khatam al-Anbia entered in this megaproject through its subsidiary company, the ‘Faradast Energy of Falat Company’,

1 To my acknowlde, the value of contract is not available.

79 as a leader of the project. As a result of that, 90% of the shares of the refinery construction consortium has given to Khatam al-Anbia, 6% to Tehran South Company, and 4% to Bina Company. Until the involvement of Khatam al-Anbia in 2010, as reported, the physical progress of the whole project was 38% and the cost has been €1.3 billion. It is, however, estimated that until 2017 the project, which was projected to be completed with €2,6 in 48 months, has cost about €4 billion. Some estimates put the cost of the first phase of the Persian Gulf Star Refinery at €3,8 billion (SHANA, 2017a; , 2017).

(V) By 2010, after withdrew from the development plan for phases 22nd, 23th, and 24th of the South Pars gas field, the contract for the implementation of these projects awarded to Khatam al- Anbia. According to NIOC, the value of the development plan is estimated at approximately $5 to $6 billion (Mehr News Agency, 2010a; Donya-e Eqtesad, 2010c). (VI) The construction of phase 3 of Urea and Ammonia Petrochemical Complex Facilities, which cost €502 million (equivalent to $600 million) (ISNA, 2018; PPC, 2018), and (VII) the 2nd phase of the Ilam Gas Refinery Development Project estimated at $120 to $150 million (Mehr News Agency, 2010b) are other two projects. (VIII) Moreover, in July 2010, Khatam al-Awsiya, a consortium close to the IRGC, signed a no-bid contract for phases 13 and 14 of the South Pars gas field, which valued at approximately $5 billion, and replaced Shell and Repsol in these phases (Donya-e Eqtesad, 2010b; FANA, 2012). (IX) The Susangard oil field development project is another contract of $500 million that was overhand to Khatam al-Anbia in 2010 (Aftab, 2010; Bourse News Agency, 2010).

(X) In 2011, the $970 million gas contract for the development of the Halgan and Sefid Baghun gas fields, located in Fars province, was awarded to Khatam al-Anbia without any tender (Bourse News Agency, 2011; DW, 2011). (XI) One year later, in 2012, with the presence of Rostam Ghasemi, the Minister of Petroleum in the second term of Ahmadinejad’s administration, the contract for the development of the Tusan and Alpha oil fields, located in 25 km from and near Qeshm and Lavan islands, was handed over to Khatam al-Awsiya, the sister company of Khatam al-Anbia. At the same time, the agreement on the development of the Band-e Karkheh oil field, in the form of a Buyback contract, was signed with the Armed Forces Social Welfare Organization (known by its Persian acronym, Shastan), an IRGC’s affiliated pension fund). The value of the three signed agreements was $1.3 billion (Bourse News Agency, 2012; Mehr News Agency, 2012a). (XII) Under this sub-area, in 2013, a contract of $1.5 billion for the construction of the NGL 3200 project in phases 1 and 2 of the North and South Azadegan fields, phases 1 and 2 of the Yadavaran, Jafir, Darkhovin, and Yaran North and South fields was signed between the Oil Engineering and Development Company (as Employer) and a consortium of domestic contractors, Khatam Al-Anbia (30%) and Bandar Imam Khomeini Petrochemical (70%) (Naftnews, 2013; IRNA, 2013; Kharg News Agency, 2009; NIOC, 2018).

80 Furthermore, four other projects have implemented by Khatam al-Anbia, namely (XIII) the development of the Somar oil field, located in the north of Kermanshah city, worth $35 million and 400 billion rials (almost $68 million) (ISNA, 2012b; Tasnim News Agency, 2013), and (XIV) the allocation of $1.3 billion for the construction and operation of central Ethylene pipeline for four Petrochemical Complex projects in Jahrom, Firoozabad, Darab, and Fasa (Nasim News Agency, 2014; YJC, 2016; Dana News Agency, 2014; Donya-e Eqtesad, 2011), (XV) early Production of Kish Gas Field at the cost of about $50 million implemented by TENCO company (TENCO, 2020), and (XVI) the development project of Kermanshah Anahita Oil Refinery, known as a national super-project, with the investment of $3.4 billion (Mehr News Agency, 2019; Oil Show Book, 2017, 55).

According to Fararoo Analytical News Agency (2012), with the signing of the contract for the development of the Tusan and Alpha, Susangard, and Somar oil fields, the number of contracts signed between the Iranian MoP and Khatam al-Anbia and Khatam al-Wasiyah reached 53 contracts with a financial amount of exceeding $17 billion. In addition, given that the development projects of a set of phases of South Pars gas field were implemented by Khatam al-Anbia’s associated companies, in March 2019, at the opening ceremony of phases 13, 22, 23 & 24 of South Pars, Saeed Mohammad, commander of Khatam al-Anbia, announced that totally $12 billion had been invested in the development projects of these phases of South Pars Gas Field (IRIB News Agency, 2019).

Meanwhile, Khatam al-Anbia has several other projects in this area that, at least based on my acknowledge, their values are not published, namely launch utility & offsite LNG project, execution of DMC phases 2, 3, 4, 5, 9 and 10 of South Pars (NIOC, 2017), construction and installation of Assaluyeh Alfin complex, and construction of Kavian petrochemical water intake complex (Khatam, 2020a)

4.3.1.3. Oil and gas storage tanks As mentioned above, Khatam al-Anbia is also active in the area of ‘oil and gas storage tanks’. The most important completed projects of the company in this area are: (I) constructing six oil storage tanks in the Isfahan region with the cost of 15 billion tomans ($18 million) (SHANA, 2005; Boran News, 2011), (II) a $500 million contract for building a reservoir, pier and port facility for phase 12 of South Pars in 2007 (ISNA, 2008), (III) the construction of the LNG and LPG double-walled tanks of the Iran LNG project was handed over to a consortium consisting of Khatam al-Anbia and Daimler company of by signing a contract of €245 million (approximately $330 million) (Mehr News Agency, 2010d), (IV) the building of the two propane and two butane tanks, the estimated cost is about $60 million (SHANA, 2009b), (V) a contract for design and construction of underground oil and crude storage tanks worth 2 billion tomans (PEDEC, 2011; IOTC, 2012), (VI) for the construction of 4 one-million-barrels of oil storage in Kharg Island, there were invested more than 334 billion rials ($33.5 million) and $4.190.000 (approximately $38 million) (SHANA, 2015). (VII) To implement the heating system plan of Mahshahr furnace oil storage facility, Amin Company, a subsidiary of Khatam al-Anbia, by

81 concluding a contract worth 127 billion rials ($4.140 million), undertook the entire purchase, installation, and execution (SHANA, 2017b).

Besides, Khatam al-Anbia has implemented several other projects in this area that, to my acknowledge, the contracts’ value of these projects is not available. These projects are the following: design, construction, and installation of (I) oil reservoir tanks in Tabriz, Hamedan, Ahvaz, Yasuj; (II) LNG and LPG tanks in Tombak port; (III) 23 reservoir tanks for petroleum products in eleven cities across the country; (IV) 60.000 cubic meter gas condensate in phases 4 and 5 of South Pars; and (V) fuel tanks of 32.000 cubic meters in Shahid Salimi Neka power plant (Khatam, 2020b)

4.3.1.4. Oil and gas transmission pipelines The last area of energy targeted by Khatam al-Anbia is the ‘oil and gas transmission pipelines.’ The first project in this area was (I) the construction of the 7th national gas pipeline (Assaluyeh-Sistan and Baluchestan, also known as Peace pipeline). A no-bid contract for the construction of the first phase of this pipeline, with a length of approximately 907 km and worth $1.3 billion, started in 2006 and ended in 2010. (II) Also, the construction of the 2nd phase of the seventh national pipeline, with an approximate length of 270 km, has handed over to Khatam al-Anbia, at a worth of about $200 million to $250 million (Mehr News Agency, 2010d; ASRIRAN, 2010; MOP, 2010; SHANA, 2006). (III) In February 2006, there were several projects awarded to Khatam al-Anbia, including the Sarakhs to Dargaz gas pipeline project, with an allocation credit of 450 billion rials ($45 million) (ISNA, 2006; Mehr News Agency, 2006), and (IV) Hamedan-Bijar gas transmission pipelines in excess of $180 million (IGEDC, 2011a; Keyhan, 2007).

(V) In 2008, the construction of the 2nd Khorramabad-Kuhdasht gas pipeline (169 km) was also implemented by Khatam al-Anbia (through its subsidiary Arvandan Institute) with 2.725 billion rials ($275 million) (SHANA, 2010; IGEDC, 2011b). (VI) Besides, the contract for the water intake project for the Persian Gulf Star Refinery, which is the country's second water intake project, was signed in October 2008 with Iran Marine Industrial Company (SADRA), a Khatam al-Anbya’s affiliates company, at the amount of €96 million (SHANA, 2017a). It is worthy to note that 51% of SADRA’s share was bought by Khatam al-Anbia in April 2009.

Moreover, several contracts were awarded to Khatam al-Anbia for the construction of the following oil and gas pipelines: (VII) the construction of the tenth national pipeline (Pataw-e- Pol-e-Kaleh) which cost 688 billion tomans ($700 million) (Mehr News Agency, 2010a; SHANA, 2014a), (VIII) the construction of the 3th section of the sixth national pipeline (Ahvaz to Dehgolan), known as Iran's gas export pipeline to Europe, with a value of approximately $1.3 billion (Donya-e Eqtesad, 2010c; Mehr News Agency, 2009b), (IX) the construction of the oil pipeline from the Abadan-Arak-Rey route worth approximately $1.3 billion (Mehr News Agency, 2012b; ISNA, 2011), (X) the construction of three oil pipelines in Khorasan, Kerman, and Hormozgan provinces, valued at about $850 million (Donya-e

82 Eqtesad, 2010d), (XI) the building of 1.680 km Neka-Jask oil pipeline (estimated at in excess of $3 billion) that will allow the transfer of one million barrels of oil per day from the Caspian see to the Persian Gulf (Donya-e Eqtesad, 2010c), (XII) a no-bid contrac for the construction of the Etan (from Parsian to Firoozabad) and Ethylene pipeline (from Firoozabad to Fasa) that the approximate value of the contract was $500 million. The purpose of its construction is to supply materials needed to Fasa, Firoozabad, Darab, Jahrom, and Estahban petrochemical complexes (Mehr News Agency, 2011; Daneshnaft, 2011a), (XIII) 3th and 4th gas pressure boosting facilities (Khormuj and Deylam) with a value of 174.425 million rials (Daneshenaft, 2011b; IGEDC, 2011c), (XIV) the construction of the Saveh-Qazvin- Koohin gas pipeline at the cost of about 2.900 billion rials ($300 thousand) (Daneshenaft, 2011b; ISNA, 2009), (XV) the construction of Abadan-Ahvaz-Arak-Tehran pipeline with an investment of 8.000 billion rials ($350 million) (SHANA, 2014b; NIOEC, 2020), (XVI) Mahshahr Export Port Organization Project (the sea section) with an investment of 700 billion rials ($150 million) (NIOEC, 2020), (XVII) the construction of water pipeline from Bahmanshir river to Abadan refinery with the value of 700 billion rials, and (XVIII) the construction of Sabzab-Tang Fani- Shazand-Rey crude oil pipeline (transfer of Abadan-Ray oil products and construction of Sabz-Ab-Ray oil pipeline) at the const of 1.300 billion tomans (ISNA, 2011).

4.3.2. The IRGC’s involvement in the energy sector during the presidential terms As discussed, Khatam al-Anbia as the most important economic arm of the IRGC has entered the field of oil, gas, and petrochemical contracting since the end of the 1990s, which coincided with the 2nd term of Khatami’s presidency. Although during this period, there was a clear conflict was among the Reformist faction, under the leading of Khatami, and the Principlist faction (and its alliance the IRGC), Khatami sought to win the IRGC’s compliance by following in his predecessor’s footsteps. To realize this aim, Khatami defended the IRGC’s role in the country’s reconstruction plan (Hassan-Yari, 2005). Following this trend, Khatam al-Anbia accelerated its involvement in Iran’s economy during the Ahmadineads’ presidential terms and has gradually become one of the largest contractors of industrial and developmental projects. It is worthy to mention that in May 2005, just before Ahmadinejad became the President, Bijan Zanganeh, the MoP in Khatami’s administration, canceled an awarder contract to a consortium (consist of Norway’s Aker Kvaerner, Sadra company, and Khatam al-Anbia) for developing phase 15 and 16 of the South Pars (Yong, 2013, 14). Nevertheless, Figure 4.2 and Table 4.3 indicate that in the second term of Khatami’s presidency, three projected have been awarded to Khatam al-Anbia and its subsidiary companies that together worth $43 million. Related to other periods, this amount is a handful proportion (less than 1% of the total contracts’ value). This is, however, a starting point of a marked change of the IRGC’s involvement in the oil and gas industry.

After the end of Khatami's presidency, Mahmoud Ahmadinejad came on power on 3 August 2005. As Figure 4.2, 4.3, and Table 4.1 demonstrate, since 2006, the presence of Khatam al-Anbia in the oil and gas industry has increased enormously. As before discussed, although the engagement of the

83 IRGC’s affiliated companies in the economy, particularly the petroleum industry, began earlier, some reformist newspapers such as Farhang-e Ashti, Etemad-e Melli, and Sharg openly postulated that Ahmadinejad’s factional preferences catalyzed the acceleration of the IRGC’s extension into the economy (Maloney, 2015, 343).

Figure 4.2 The value and ratio of awarded contracts to the IRGC's associated companies in the oil, gas, and petrochemical field in each presidential term between 2000 and 2019).

$27.781

0% 22% 16%

$9.565 62% $7.169

$43

2nd term of 1st term of 2nd term of 1st term of 2nd term of Khatami (2001-05) Khatami Ahmadinejad Ahmadinejad Rouhani 1st term of Ahmadinejad (2005–09)

Total value of contracts (in million dollars) contracts million (in of value Total (2001-05) (2005–09) (2009–13) (2013–17) 2nd term of Ahmadinejad (2009–13) Per each presidencial term 1st term of Rouhani (2013–17)

Source: The calculation is based on the data of Table 4.1, which was collected from various primary sources as presented in the following sections (4.3.11; 4.3.1.2; 4.3.1.3; 4.3.1.4), author calculation.

Figure 4.3 The annual value of awarded contracts to the IRGC's associated companies in oil, gas, and petrochemical area between 2000 and 2019.

$25.000

$20.000

$15.000

$10.000

$5.000

$- Value of contract per per year of million dollars) (in contract Value 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

$-5.000 Year

Source: The calculation is based on the data of Table 4.1, which was collected from various primary sources as presented in the following sections (4.3.11; 4.3.1.2; 4.3.1.3; 4.3.1.4), author calculation.

84 During the first presidential term of Ahmadinejad (2005-2006), about 15 projects in different sub- areas of oil, gas, and petrochemical fields were awarded to Khatam al-Anbia and its subsidiaries. Overall, the value of these projects is more than $7 billion which is a huge increase in comparison with the previous period. The contracting of phases 15 and 16 of South Pars Gas Development (near to $3 billion) and the construction of the first phase of the seventh nationwide pipeline ($1.3 billion) contributed to the critical proportion of this sweeping change in the involvement of the IRGC’s associated companies in this industry. Since the reelection of Ahmadinejad for its second presidential term (2009-13), the activities of the IRGC’s companies are profoundly expanded from 16% to 62% in relation to the total value so far. The increasing trend of Khatam al-Anbia’s involvement in the oil, gas, and petrochemical projects reached its peak in 2010 with 12 projects in various areas at which the total value of the contracts exceeded $21 billion, which constructs 50% of the whole projects’ value. The signing of contracts for the development project of phases 22, 23 & 24 ($6 billion) and phases 13 & 14 ($5 billion) of the South Pars Gas Field is the primary proportion of this considerable peak (see Figure 4.2 and Tabe 4.1).

It is important to note that while Rostam Ghasemi, the previous commander of Khatam al-Anbia and a prominent cadre of the IRGC, was appointed as MoP from 3 August 2011 to 15 August 2013, as Figure 4.3 and Table 4.1 illustrate, the number of contracts and their values have experienced and sharp decrease from $21 billion in 2010 to $5 billion in 2011 and $850 million in 2012. The involvement of the IRGC’s affiliated companies in this sector ended in this period with the gaining of three contracts in 2013 with a value of virtually $1.6 billion which is a slight increase compared to the two previous years. Moreover, the end of Ahmadinejad’s presidency, as an important political coalition of the IRGC, did not lead to the withdrawing of the IRGC’s affiliated companies in the oil and gas sector. The victory of Hassan Rouhani as the new president resulted, on the one hand, in the decreasing of ratio and value of contracts in this period (2013-19) from $27 billion (during Ahmadinejad’s terms) to almost $10 billion in Rouhani’s era (from 62% to 16%), which is a noticeable decrease of 74%. On the other hand, this period reached a peak of around $4 billion in 2016 by an awarded contract for the construction of ‘the heating system plan of Mahshahr furnace oil storage facility ($4.140 billion), which is a clear growth in comparison with 2014 (%1.9 billion). Following, the enter of Khatam al-Anbia in one of the most important projects, the construction of Petro Anahita Oil Refinery in Kermanshah with an investment of $ 3.4 billion, shows a consistent involvement of the IRGC as a leading actor in this industry.

Bijan Zanganeh, the current MoP, told in a news conference at the site of Phase 13 of South Pars that "many people wanted to put a distance between us and Khatam al-Anbia Construction Headquarter, and between us and the IRGC, which we did not allow," He praised the performance of Khatam al- Anbia in constructing and completing six phases of South Pars Gas Field, and said: Khatam al-Anbia “was able to complete two phases in 2015 and now it has put four more phases into operation. He

85 announced an investment of $11 billion in these four phases” (Tasnim News Agency, 2019b). Moreover, as a part of the Budget Plan for 2020, banks will be allowed to offer about $3 billion in facilities to among other cooperatives and public non-governmental organizations, and Khatam al- Anbia for upstream oil and gas development projects (IRNA, 2020),

4.4. Conclusion The objective of this chapter was to identify the extent in which the IRGC has become a central player in the Iranian oil and gas industry. The chapter presented, firstly, the historical development process of the IRGC’s affiliated companies in various economic fields since the introducing of the top-down strategy of economic liberalization in the late 1980s and at beginning of the 1990s. We have demonstrated how the gradual expansion of the IRGC’s activities in the economy resulted in the inter of its associated companies into the oil, gas, and petrochemical area.

Our findings underline the coincident of the establishment of the IRGC’s affiliated companies – including the Cooperative Foundation of the Sepah, the Cooperative Foundation of the Basij, and more importantly, the foundation of Khatam-al-Anbia in 1989 – and the state-led economic adjustment program in the same period. The IRGC’s participation in the economy started in the ‘reconstruction era’ under Rafsanjani’s presidency, expanded and strengthened during Khatami’s tenure through the establishment of the bulk of subsidiary companies to participate in various economic fields and has become one of Iran’s largest contractors (employer( in industrial and development projects. Entered in the oil and gas industry in the end of Khatami's presidency, Khatam al-Anbia as the most powerful economic arm of the IRGC has become the largest domestic contractor in this field. Consolidated its position in the sector in the course of Ahmadinejad's presidency, Khatam al-Anbia was awarded about $27 billion contracts for the implementation of many projects in the area of ‘developing of fields, refining industries, oil and gas storage tanks, and oil and gas transmission pipelines. This fact indicates that the ruling political faction, the Principals, catalyzed and augmented the IRGC’s involvement in this field so that its elimination in the economy would not be easy for competitors. This finding supports the second posed hypothesis.

Realizing a dominant position in the oil and gas industry, the IRGC’s associated companies are being active in this industry during Rouhani’s administration. Despite its slogan to break the monopoly in the economy, the position of the IRGC is so strong that it could not be ignored by Rouhani. Of course, the results over the difference between the number and contracts’ value awarded to the IRGC in the course of each government bring us to the conclusion that the political factions play an important role in the augmenting/diminution of the IRGC’s involvement in the economy. However, the main factors involved in this issue derives from the necessity of the state’s economic strategy to avoid losing control of the development process in the energy sector. It is worth recalling that the rivalry among political factions and elites has to be seen as the consequence of the factionalization of the state, and therefore,

86 the competition to secure and realize their share in the state’s economic resources. In summary, the prominence involvement of the IRGC in the oil and gas industry does not have to be interpreted as a ‘militarization of economy’ but as the long-arm of the Iranian neo-mercantilist developmentalist state in the economy.

***

87

V. Conclusion

This thesis investigated the economic and political mechanisms/factors involved in the eminence presence of the Islamic Revolutionary Guards Corps (IRGC) in the Iranian oil and gas industry. I had originally argued that the involvement of military forces in the economy is understandable in relation to the broader context of the dynamics of the political economy of Iran. This is primarily in light of the fact that the IRGC as a military institution and its evolution to a political and economic player cannot be considered as an isolated entity but as a genuine product/outcome of the particular forces within the Iranian capitalist society. That means that the IRGC’s involvement in the economy has to be seen as the outcome of the interaction among the triangulation of (I) the authoritarian form of the Iranian state and its strategy to secure its survival and maintain its control over the society, (II) pursuing a top-down economic reconstruction to develop the national economy, and (III) the non-hegemonic class structure of Iranian society at which the ruling class can not mobilize the social forces to achieve economic development without the extensive intervention of the state. The interplay of these factors generates various social outcomes.

Departing from this perspective, this thesis examined the impact of the state-led economic strategy of the Islamic Republic since 1989 on the historical evolution of the IRGC’s involvement in the economy, in particular in the oil and gas industry. In addition to economic mechanisms, it inquired into the role of the rivalry among political factions within the Islamic Republic on the augmenting and diminution of the IRGC’s presence in this area. In contrast to some scholars who restrict their study to describing the IRGC’s activities in the Iranian economy or explain this trend as ‘militarization of the economy’, I argued that the prominence involvement of the IRGC in the economy has to be considered as the reliable instrument and long-arm of the state in the economy to realize its political and economic strategy. That is a top-down strategy of economic development which required the involvement of the IRGC as one of the most well-organized and coherent institutions to secure its strict control over the reshaping of the national economy and to satisfy the implementation of neoliberal economic policies. In this process, I contend that due to the lack of unity within the state, the rivalry among political factions and elites affects as a mediator factor the degree of the IRGC’s involvement in the economy. So, the advanced arguments and theoretical approach emerged from the main research question posed: why IRGC has become a dominant actor in the Iranian oil and gas industry? The posed question is an explanatory question to explain the primary mechanisms/factors that caused the prominence of the IRGC’s involvement in this industry. The presented results support the posed hypotheses and arguments as following.

Historically, as has been presented, the IRGC was established for the purpose of the consolidation of the Islamic Republic as a form of state corporatism. This was the outcome of the passive revolution

88

of 1979 whereby neither the revolutionary working-class and leftist forces nor the capitalist class was able to achieve their hegemony over the Iranian upheaval society in the late 1970s. The Political Islam forces, under the leading of Khomeini, which derived from a middle-class populist movement, took political power and employed the IRGC as a suppression instrument to eliminate social conflicts and maintain social harmony and order in post-revolutionary Iran. Socio-political impact of the revolution, the war with Iraq, and the depth economic crisis in the second half of the 1980s forced the Islamic Republic to take away his populist slogans and transfer into a state-led strategy of ‘dependent development’ in accordance with the dominant world economy of the neoliberal economic policies. This trend caused the transformation of the state corporatism toward the neo-mercantilist developmentalist state of the Islamic Republic. This shift and the top-down strategy of the state entailed some changes by which the IRGC was involved in the economy and gradually has become the largest domestic contractor in the oil and gas industry.

Firstly, as diagnosed, our finding shows that all governments which represent political factions, despite their competitions and dissimilarities, followed and implemented the neoliberal economic policies in the line with the prescription of the IMF and World Bank to develop the domestic economy and survive the regime. These policies aimed at the improvement of the capitalist economic relation to achieving economic growth and capital accumulation. Since the Rafsanjani’s presidency, the economic liberalization policies accompanied by the exchange rate unification and floating the rial, elimination of price control and subsidies; and the privatization of SOEs. This strategy, as presented, caused high inflation, social inequalities, and, consequently, various social unrest across the country, which led to the disruption of the economic liberalization process. More importantly, the privatization of SOEs was an economic mechanism by which the state’s affiliated parastatal foundation and military institutions, like the IRGC, were involved in controlling the economy. Regardless of the rapid privatization since 1989, we have revealed that about %50 of the divested SOE went to the state-linked entities and interest groups, such as ‘military institutions, non-governmental public institutions, parastatal foundations.’ Although the state pursued the policy of reducing the state’s interference in the economy, at the same time, the long-arms of the state were employed to maintain the state’s control over the economy. Hence, the top-down strategy of the state to mobilize the social forces and economic instruments caused the IRGC’s presence in the economy.

Secondly, the results demonstrated that the economic development policies of the Islamic Republic was/is profoundly dependent on petroleum revenues. On average, the oil revenues contributed to approximately 80% of total Iran’s export, and 55% of total government revenues between 1979 and 2017. The excessive dependence on oil revenues has brought the Iranian government to a vulnerable position. To realize economic development, within the framework of the economic liberalization policies, the regime made gradual changes in the structure of the oil and gas industry so that they could attract foreign capital in this industry, although they have not achieved the required foreign capital.

89

Within the strategy of the liberalization of the energy sector, the regime established various subsidiary domestic contractors in the field of oil and gas industry in response to the development of this industry. This transformation generated conditions for the involvement of many commercial capitalists, elites, parastatal and military entities, and political factions in the oil and gas development projects. In the meantime, the IRGC’s affiliated companies, in particular Khatam al-Anbia, expanded their activities to the oil and gas industry and have become the largest and dominant actor in this area. This trend brings us to the conclusion that the eminence presence of the IRGC in this sector has to be explained in the context of the regime’s liberalization policies at which, on the one hand, the state secure its strong authority over this sector by its affiliated entities as state’s long-arms. On the other hand, the state uses this (semi)private companies to satisfy the requirement of attracting foreign investment.

Thirdly, in contrast to those who attribute the involvement of the IRGC in the economy to particular political faction, the Principals in the course of Ahmadinejad’s presidency, we have provided shreds of evidence that the involvement of the IRGC in the economy emerged since Rafsanjani’s tenure. Especially, the establishment of the IRGC’s economic entities, including of Khatam al-Anbia, coincided with the launching of the state-led economic adjustment program since 1989. The IRGC’s associated companies expanded their activities to various economic fields and entered the oil and gas industry in the late Khatami’s presidential term, consolidated its position in this industry in the course of Ahmadinejad’s administration, and is continuing in Rouhani’s government. The controversial point here is that Khatam al-Anbia was awarded about $27 billion contracts for the implementation of many projects in the area of ‘developing of fields, refining industries, oil and gas storage tanks, and oil and gas transmission pipelines’ in the two presidential terms of Ahmadinejad, which is by far much more than other periods. This trend indicates that the ruling political faction, the Principals, augmented the IRGC’s involvement in this field so that its elimination in the economy would not be easy for competitors, which confirms the second posed hypothesis.

In summary, the role of political factions is a mediator factor in this process and influenced the degree of this involvement. The historical and ongoing struggle of political factions within the Islamic Republic features the rivalry between ruling groups and elites to occupy relatively more shares of the rents and state’s revenues. Despite any degree of competition and some political differences, the central point of the intersection of all these political factions was and is continuing to preserve the Islamic Republic and strengthen the mechanisms of the capitalist economy. The later aspect aims to reconstruct the income distribution by enhancing the share of capital accumulation (profit) and reducing the share of the working class and other subordinated social groups (wage). To sum up, the position of the IRGC as a well-organized military, political, and economic institution has to be seen as long-arm of the state in the society and understand in direct relation to the dynamism and the structure of the Iranian political economy in a particular historical process.

90

The strong aspect of this study is its internal validity. That is in the light of the fact that the neo- Gramscian approach is critical in the sense of its position in relation to the prevailing the established order and is the theory of history in the sense of being concerned with the continuing process of historical changes, and the applying process-tracing method to investigate our case during a certain time span. By following and examining the IRGC’s involvement in the economy as an extreme case for about four decades, the researcher came relatively closer to cause-effect relationships (causal mechanisms) by looking at the time sequence and cohesion within different components of the Iranian political-economic system. In contrast to internal validity, the applying of process tracing struggles with the generalization of approved hypotheses. Our posed causal mechanisms are indeed operationalized in specific economic and political factors, and process tracing is a within-case method of analysis, which can be considered a problematic of the generalization aspect of this thesis (Bennet & Checkel, 2015, 13). However, the critical theory deals with the changing reality over time and adjusts its concepts to understand the reality adequately. In this sense, on the contrary to those scholars who drive the lineages of the IRGC in the economy from the policy of a particular political faction and see it as ‘militarization of the economy’, our theory and hypotheses are directed to the socio-political and economic complex as a whole rather than to sperate parts. In other words, to understand the IRGC’s involvement in the Iranian economy, we investigated and analyzed it in a broader context of the political economy of Iran during the post-revolutionary era. Hence the theoretical approach and concepts can be applied in other cases to look at the changing of a specific social phenomenon as the reality, coherence, and interrelation of different components of an entire complex system. Although the case of the IRGC is unique and is a product of the historical development of Iranian political economy, it is, however, possible to apply the theory and plausible hypothesis to compare it with other cases in relatively similar contexts, such as the role of military forces within non-hegemonic societies in the Global South by focusing on the particular historical structure.

The main important challenge with which this thesis struggled was the lack of transparency and availability of primary data in the field of the IRGC’s activities in the economy, particularly in the oil and gas industry. Although the factors involved in the IRGC’s presence in the economy is proved, I shall recommend for more research in this field to map the involvement of the military institutions in the energy sector. Moreover, given that the IRGC has become a large employer in Iran, it is interesting to investigate its social impact on the workforce in the oil and gas industry. The necessity of this point is that the IRGC’s evolution into an economic player brought the IRGC to a direct position in the social relation of production, which changed the relationship between social classes (the employers and employees). In this case, the IRGC’s companies and the involved workforce have a direct relationship in this process. This research question should be the following: what the impact of the IRGC’s involvement on the workforce socio-economic position in the oil and gas industry is.

***

91

Bibliography

Books

Abrahamian, E. (1993). Khomeinism: Essays on the Islamic Republic. California: University of California Press.

.[the political economy of the Islamic Republic] اقتصاد سیاسی جمهوری اسالمی .(Ahmadi-Amui, B. (2003 Tehran: Gam-i Naw.

Amuzegar, J. (1993). Iran's economy under the Islamic Republic. London: Tauris.

Ansari, A. M. (2019). Modern Iran since 1797: Reform and revolution (3rd edition). New York: Routledge.

Bayat, A. (1988). Labor and democracy: the case of post-revolutionary Iran. In H. Amirahmadi, & M. Parvin, (eds.). Post-Revolutionary Iran (pp. 41-55). Boulder, London: Westview Press.

Beach, D., & Pedersen, R. (2013) Process-Tracing Methods: Foundations and Guidelines. Michigan MI: University of Michigan Press.

Behdad, S. (2000). From Populism to Economic Liberalism: The Iranian Predicament. In P. Alizadeh, (ed.). Iran's Economy: Dilemma of an Islamic State. London: I.B. Tauris.

Beller, D., Belloni, F. (1978). Party and faction: modes of political competition. In F. Belloni, D. Beller (eds.), Factions Politics: Political Parties and Factionalism in Comparative Perspective (pp. 417-450). ABC CLIO: Santa Barbara, CA.

Belstad, A. M. (2010). Born by Revolution, Raised by War: The Iran-Iraq War and the rise of the Islamic Revolutionary Guard Corps. Norwegian Open Research Archives (NORA): University of Oslo Press.

Cammett, M., Diwan, I., Waterbury, J., & Richards, A. (2015). A political economy of the Middle East (Fourth edition). Boulder, CO: Westview Press, a member of the Perseus Books Group.

Cox, W. R. (1989). Production power and world order: Social forces in the making of history. New York: Columbia University Press.

Forozan, H. (2013). The Military in the Islamic Republic of Iran: an Assessment of the Sepah's Role (IRGC) as a Political and Economic Actor. Durham theses: Durham University.

92

Forozan, H. (2015). The Military in Post-Revolutionary Iran: The evolution and roles of the Revolutionary Guards. London and New York: Routledge.

Fürtig, H. (2002). Iran’s Rivalry with Saudi Arabia between the Gulf Wars. Reading, UK: Garner Publishing Limited.

George, A. L., & Bennett, A. (2005). Case studies and theory development in the social sciences. Cambridge: MIT Press.

Gerring, J. (2007). Case Study Research: Principles and Practices. Cambridge: Cambridge University Press).

Gheissari, A., & Nasr, V. (2006). Democracy in Iran: History and the quest for liberty. New York: .

Gramsci, A. (1999). Selections from the prison notebooks of Antonio Gramsci (Edited and translated by Quintin Hoare and Geoffrey Nowell-Smith). London: Lawrence and Wishart.

Haggard, S., & Kaufman, R. (eds.) (1992). Institutions and Economic Adjustment. In S. Haggard, R. R. Kaufman, & P. B. Evans (eds.), The Politics of Economic Adjustment: International Constraints, Distributive Conflicts, and the State (pp. 3-37). Princeton, N.J.: Press.

Harik, I. (1992). Privatization: the issue, the prospects and the fears. In I. Hark, & D. J. Sullivan (eds.), Privatization and liberalization in the Middle East. Bloomington, IN: Indiana University Press.

Harvey, D. (2005). A brief critique of neoliberalism. New York: Oxford University Press.

Hedström, P., & Swedberg, R. (1998). Social mechanisms: an analytical approach to social theory. Cambridge: Cambridge University Press.

Hunt, E. K., & Lautzenheiser, M. (2011). History of economic thought: a critical perspective (third edition). London & New York: Taylor & Francis Ltd.

Karimi, S. (1986). Economic policies and structural changes since the revolution. In N. Kiddie, and E. Hooglund (eds.), The Iranian revolution and the Islamic Republic (pp. 32-54). Syracuse, NY: Syracuse University Press.

Keddie, N. R., & Yann, R. (2003). Modern Iran: roots and results of revolution [Rev., updated ed.]. New Haven, CT.: Yale University Press.

Klaren, P. F., & Bossert, T.J. (1986). Promise of development: Theories of change in Latin America. Boulder: Westview Press.

93

Mahdavi, H. (1970). The Patterns and Problems of Economic Development in a Rentier Stare: The Case of Iran. In M. A. Cook (ed.), Studies in Economic History of the Middle East. London: Oxford University Press.

Mahdavi. P. (2011). Oil, monarchy, revolution, and theocracy. A study of the national oil company. In D. Victor, D. Hults, & Thurber, M. (eds). Oil and governance: state-owned enterprises and the World Energy Supply (pp. 234-279). New York: Cambridge University Press.

Maloney, S. (2000). Agents or obstacles? Parastatal foundations and challenges for Iranian development. In P. Alizadeh (ed.). The Economy of Iran: The Dilemmas of an Islamic State (pp. 145-176). London: I.B. Tauris.

Maloney, S. (2015). Iran's Political Economy since the Revolution. Washington D.C: Cambridge University Press.

Marx, K. (1993 [1857]). Grundrisse: Foundations of the critique of political economy. Londen: Penguin Books Ltd.

Moslem, M. (2002). Factional Politics in Post-Khomeini Iran. New York: Syracuse University Press.

Nomani, F., & Behdad, S. (2006). Class and Labor in Iran: Did the Revolution Matter? Syracuse, NY: Syracuse University Press.

Ostovar, A. (2009). Guardians of the Islamic Revolution ideology, politics, and the development of military power in Iran (1979–2009). Ann Arbor: University of Michigan Press.

Rakel, E. P. (2008). The Iranian political elite, state and society relations, and foreign relations since the Islamic revolution. Amsterdam: University of Amsterdam.

Sinkaya, B. (2016). Revolutionary Guards in Iranian Politics: Elites and Shifting Relations. London & New York: Routledge.

Stilwell, F. (2012). Political Economy: The contest of economic ideas. (third edition). Australia & New Zealand: Oxford University Press.

Wehrey, F. M., Green, J. D., Nichiporuk, B., Nader, A., Hansell, L., Nafisi, R., & Bohandy, S.R. (2009). The rise of the Pasdaran assessing the domestic roles of Iran's Islamic Revolutionary Guards Corps. Santa Monica, CA: RAND National Defense Research Institute.

Yong, W. (2013). NIOC and the State – Commercialization, contestation and consolidation in the Islamic Republic of Iran. Oxford: The Oxford Institute for Energy Studies.

Zabih, S. (1988). The Iranian Military in Revolution and War. London & New York: Routledge.

94

Peer-reviewed journal articles

Alfoneh, A. (2013). Iran Unveiled: How the Revolutionary Guards Is Turning Theocracy into Military. Choice Reviews Online, 51(05), pp. 51-2890.

Amineh, M. P., & Guang, Y. (2018). ’s Geopolitical Economy of Energy Security: A Theoretical and Conceptual Exploration. African and Asian Studies, 17(1-2), pp.9-39.

Amuzegar, J. (1984). Oil Exporters' Economic Development in an Interdependent World, Occasional Paper. Cerbaf Journal of Banking and Finance, 8(1), pp.140-262.

Amuzegar, J. (2007). Islamic social justice, Iranian style. Middle East Policy, 14(3), pp. 60-79.

Amuzegar, J. (2009). Iran's 20-year economic perspective: promises and pitfalls. Middle East Policy 16, pp. 41-57.

Bakhash, S. (1989). The politics of land, law and social justice in Iran. Middle East Journal 43(2), pp. 186–201.

Bina, C. (2017). Iran’s Oil, the Theory of Rent, and the Long Shadow of History: A Caveat on Oil Contracts in the Islamic Republic. Revue internationale des études du développement, 229(1), pp. 63-90.

Bjorvatn, K., Selvik, K. (2008). Destructive competition: Factionalism and rent-seeking in Iran. World Development 36, pp. 2314-2324.

Coville, T. (2017). The economic activities of the Pasdaran. Revue internationale des études du développement, 229(1), pp. 91-111.

Cox, W. R. (1981). Social forces, states, and world orders: Beyond international relations theory. Millennium: Journal of International Studies, 10(2), pp. 126-155.

Cox, W.R. (1983). Gramsci, Hegemony and International Relations: An Essay in Method. Millennium - Journal of International Studies, 12(2), pp. 162-175.

Dorraj, M. (2017). Populism and Corporatism in the Middle East and North Africa: a Comparative Analysis. Chinese Political Science Review, 2(3), pp. 288-313.

Ehsani, K. (2009) Privatization of Public Goods in the Islamic Republic. Middle East Report, 250, pp. 26-33.

Ehteshami, A., & Murphy, C. E. (1996). Transformation of the corporatist state in the Middle East. Third World Quarterly, 17(4), pp. 753-772.

95

Farzanegan, M. R. (2010). Oil revenue shocks and government spending behavior in Iran. Energy Economics, 33, pp. 1055-1069.

Farzanegan, M. R., Bjorvatn, K., & Schneider, F. (2011). Oil revenues, political power, and economic growth in Iran: theory and evidence. University of Rennes 1, EPCS.

Farzanegan, M.R., Bjorvatn, K., & Schneider, F. (2011), Oil revenues, political power, and economic growth in Iran: theory and evidence, University of Rennes 1, EPCS.

Forozan, H., & Shahi, A. (2017). The military and the state in Iran: the economic rise of the Revolutionary Guards. The Middle East Journal, 71(1), pp. 67-86.

Golkar, S. (2012). Paramilitarization of the economy: The case of Iran’s Basij militia. Armed Forces & Society, 38(4), pp. 625-648.

Harris, K. (2013). The rise of the subcontractor state: politics of pseudo-privatization in the Islamic Republic of Iran. Int. J. Middle East Stud. 45, pp. 45–70.

Hen-Tov, E., & Gonzalez, N. (2011). The militarization of Post-Khomeini Iran: Praetorianism 2.0 The Washington Quarterly, 34(1), pp. 45-59.

Hourcade, B. (2009). The rise to power of Iran’s “Guardians of the Revolution”. Middle East Policy, 16(3), pp. 58-68.

International Monetary Fund (2017). Article IV Consultation, Islamic Republic of Iran. IMF Country Report, 17(62), pp. 4-20.

Jafari, P. (2019) Linkages of oil and politics: oil strikes and dual power in the Iranian revolution. Labor History, 60(1), pp. 24-43..

Karshenas, M., & Malik, A. (2012). Oil in the Islamic Republic of Iran. In p. Collier, & A. J. Venables (eds.). Plundered Nations?: Successes and Failures in Natural Resource Extraction (pp. 114- 150). New York: Palgrave Macmillan,

Karshenas, M., & Pesaran, H. (1995). Economic reform and the reconstruction of the Iranian economy. Middle East Journal, 49(1), pp. 89-111.

Khajepour, B (2000). Domestic Political Reforms and Private Sector Activity in Iran. Social Research 67, pp. 577–98.

Kuhn, M., & Jannatifar, M. (2012). Foreign direct investment mechanisms and review of Iran’s buy- back contracts: how far has Iran gone and how far may it go? Journal of World Energy Law and Business, 5(3), pp. 207-234.

Mahoney, J., & Goertz, G. (2006). A Tale of Two Cultures: Contrasting Quantitative and Qualitative

96

Research. Political Analysis, 14(3), pp. 227-249.

Dimensions of] ابعاد خصوصیسازی و آثار آن بر سرمایهگذاری خصوصی: مطالعه موردی ایران .(Muradi, B. (2005 privatization and its effects on private investment: A case study of Iran]. Itila’at-i Siyasi- Iqtisadi 213(14), pp. 180–99.

Rizvi, A. M. (2012). Evaluating the Political and Economic Role of the IRGC. Strategic Analysis, 36(4), pp. 584-596.

Roberts, P. (2015). Passive revolution in : struggles over hegemony, religion, and development 1964-2007. Third World Quarterly, 36(9), pp. 1663-1681.

Safshekan, R., & Sabet, F. (2010). The Ayatollah’s Praetorians: The Islamic Revolutionary Guard Corps and the 2009 Election Crisis. The Middle East Journal, 64, pp. 543–58.

Seawright, J., & Gerring, J. (2008). Case selection techniques in case study research: A menu of qualitative and quantitative options. Political Research Quarterly 61 (2), pp. 294-308.

Torbat, A.E. (2005). Impacts of the US Trade and Financial Sanctions on Iran. World Economy, 28(3), pp. 407-434.

Trampusch, C., & Palier, B. (2016). Between X and Y: how process tracing contributes to opening the black box of causality. New Political Economy, 21(5), pp. 437-454.

Van Groenendaal, W. J. H, & Mazraati, M. (2006). A critical review of Iran's buyback contracts. Energy Policy, 34(18), pp. 3709-3718.

Zahirinejaad, M. (2012). The role of the political structure in Iran’s energy decision making policy. Journal of Third World Studies, 29(1), pp. 231-249.

97

Online recourses

Alfoneh, A. (2007). How Intertwined Are the Revolutionary Guards in Iran’s Economy? Middle East Outlook. American Enterprise Institute for public policy research, 3. Available at: https://www.aei.org/research-products/report/how-intertwined-are-the-revolutionary-guards- in-irans-economy/

Alfoneh, A. (2010). The Revolutionary Guards’ Looting of Iran’s Economy. American Enterprise Institute for Public Policy Research. Available at: https://www.aei.org/wp- content/uploads/2011/10/03-MEO-2010-g.pdf

Hassan-Yari, H. (2005). Iran: Defending the Islamic Revolution, the corps of the matter. Available at: https://www.rferl.org/a/1060431.html

Heuty, A. (2012). Iran’s oil and gas management. The revenue watch institute. Available at: https://resourcegovernance.org/sites/default/files/rwi_bp_iran2.pdf

Jafari, P. (2014). Labour activism and democracy in Iran. Leiden University & University of Amsterdam. Available at: https://www.researchgate.net/publication/278000392_Labour_Activism_and_Democracy_in_ Iran

Sociological analysis of the] تحلیلی جامعه شناختی از زمینه های ظهور و گسترش اسالم سیاسی .(Saidi. H. (2019 contexts of the emergence and spread of political Islam]. Political economy critique. Available at: https://wp.me/p2GDHh-3f8

98

Primary recourses Details of the $ 10 billion oil] جزئیات ۱۰ میلیارد دالر پروژه نفتی در قرارگاه خاتم االنبیا .(Aftab (2010 project at Khatam al-Anbia Headquarterr]. Available at: https://www.magiran.com/article/2094412

Assignment of construction of] واگذاری ساخت فاز 2 خط لوله صلح به قرارگاه خاتماالنبیا .(ASRIRAN (2010 phase 2 of the peace pipeline to Khatam al-Anbia camp]. Available at: asriran.com/000Xvn

Isfahan Refinery's] ظرفیت ذخیره سازی نفت خام پاالیشگاه اصفهان به 4 میلیون بشکه رسید .(Borna News (2011 crude oil storage capacity has reached 4 million barrels]. Available at: https://www.borna.news/fa/tiny/news-17544

$ Assignment of] واگذاری ۱۰ میلیارد دالر پروژه نفتی به قرارگاه خاتم االنبیا .(Bourse News Agency (2010 10 billion oil project to Khatam al-Anbia camp]. Available at: boursenews.ir/0008JV

A new $ 1] توافق جدید یک میلیارد دالری وزارت نفت و قرارگاه خاتماالنبیا .(Bourse News Agency (2011 billion agreement between the Ministry of Oil and the Khatam al-Anbia]. Available at: boursenews.ir/000CBH (April 30, 2011).

The development] توسعه دو میدان نفتی به قرارگاه »خاتم االوصیاء« واگذار شد .(Bourse News Agency (2012 of two oil fields was handed over to the Khatam al-Awsiya]. Available at: boursenews.ir/000HR7

British Petroleum (2017). BP Statistical Review of World Energy June 2017. Available at: https://www.connaissancedesenergies.org/sites/default/files/pdf-actualites/bp- statistical-review-of-world-energy-2017-full-report.pdf

متن ابالغیة رهبر معظم انقالب اسالمی در خصوص سیاست هاي كلي اصل 44 قانون اساسی .(Cabinet Office (2005 Text of the Directive of the Supreme Leader of the Islamic])تاریخ ابالغ: ۱ /3 /۱384( Revolution Regarding the General Policies of Article 44]. Available at: http://cabinetoffice.ir/fa/content/68

Central Bank of Iran (2010). Annual National Accounts of Iran. Available at: http://www.cbi.ir/section/1372.aspx. (May 11 2011).

Central Bank of Iran (2020). Data for oil and gas production, export, import, price. Available

at https://tsd.cbi.ir/DisplayEn/Content.aspx

99

.[Introducing major domestic contractors] معرفی پیمانکاران بزرگ داخلی .(Dana News Agency (2014 Available at: http://danakhabar.com/fa/mobile/1171211

Assignment of 2 oil] واگذاری بدون تشریفات 2 پروژه نفتی به قرارگاه خاتم االنبیا .(Daneshnaft (2011a projects to Khatam al-Anbia base without formalities]. Available at: http://www.daneshenaft.ir/cvid/250/content/4335/default.aspx (March 7, 2011)

The significant] حضور چشمگیر قرارگاه سازندگي خاتم در پروژه هاي نفت و گاز .(Daneshnaft (2011b presence of Khatam Construction Camp in oil and gas projects]. Available at: http://daneshenaft.ir/cvid/250/content/5042/default.aspx

Parliament: Only 13% of] مجلس: فقط ۱3 درصد خصوصیسازی واقعی بوده است .(Deutsche Welle (2010 privatizations were real]. Available at: https://p.dw.com/p/QkXz

The $1 billion gas] پروژه یک میلیارد دالری گازی به سپاه پاسداران واگذار شد .(Deutsche Welle (2011 project was handed over to the Revolutionary Guards]. Available at: https://p.dw.com/p/116p0

Rouhani: The IRGC is not a rival of] روحانی: سپاه رقیب مردم و بخش خصوصی نیست .(Deutsche Welle (2013 the people and the private sector]. Available at: https://p.dw.com/p/19iHl

Akbar Turkan: Our force will] اکبر ترکان: زورمان به قرارگاه خاتم االنبیا نمیرسد .(Deutsche Welle (2014 not reach the Khatam al-Anbia camp]. Available at: https://p.dw.com/p/1DGYY

History and scope of economic] سابقه و دامنه فعالیتهای اقتصادی سپاه پاسداران .(Deutsche Welle (2017 activities of the Revolutionary Guards]. Available at: https://p.dw.com/p/2gjtt.

billion 15 $] مشارکت ۱۵ میلیارد دالری »قرارگاه خاتم« در پروژه های نفت و گاز .(Donya-e Eqtesad (2010a Khatam Camp participation in oil and gas projects. Available at: https://www.donya- e-eqtesad.com/fa/tiny/news-607716

Two phases of South Pars] دو فاز پارس جنوبی در اختیار اولین کنسرسیوم ملی .(Donya-e Eqtesad (2010b at the disposal of the first national consortium]. Available at: https://www.donya-e- eqtesad.com/fa/tiny/news-609193

billion 15 $] مشارکت ۱۵ میلیارد دالری »قرارگاه خاتم« در پروژههای نفت و گاز .(Donya-e Eqtesad (2010c Khatam Camp participation in oil and gas projects]. Available at: https://www.donya- e-eqtesad.com/fa/tiny/news-607716

100

$ Assignment of another] واگذاری 8۵۰ میلیون دالر پروژه دیگر به قرارگاه خاتم .(Donya-e Eqtesad (2010d 850 million to Khatam al-Anbia]. Available at: https://www.donya-e- eqtesad.com/fa/tiny/news-599280

The first contract with the] اولین قرارداد با »قرارگاه« بعد از وزیر جدید نفت .(Donya-e Eqtesad (2011 "Headquarter" after the new oil minister]. Available at: https://www.donya-e- eqtesad.com/fa/tiny/news-415637

History and evolution of] تاریخچه و سیر تکاملی قرارگاه سازندگی خاتماالنبیاء .(Donya-e Eqtesad (2020a Khatam al-Anbia construction headquarters]. Available at: https://www.donya-e- eqtesad.com/fa/tiny/news-3627494

-ring’s of connecting]. Available at https://www.donya-e] حلقه وصل .(Donya-e Eqtesad (2020b eqtesad.com/fa/tiny/news-3627263

-struggle of Khatam]. Available at: https://www.donya-e] رزم خاتم .(Donya-e Eqtesad (2020c eqtesad.com/fa/tiny/news-3627490

:Shortcut to national interests]. Available at] میانبر منافع ملی .(Donya-e Eqtesad (2020d https://www.donya-e-eqtesad.com/fa/tiny/news-3627261

:We have to be strong]. Available at] ما باید قوی شویم .(Donya-e Eqtesad (2020e https://www.donya-e-eqtesad.com/fa/tiny/news-3627492

How did the Persian Gulf Star become a] ستاره خلیج فارس چگونه ستاره شد؟ .(Eghtesad Online (2017 star?]. available at: https://www.eghtesadonline.com/n/11cE

Energy Information Administration (2018). Country Analysis Brief: Iran. Available at: https://www.eia.gov/international/content/analysis/countries_long/Iran/archive/pdf/ira n_2018.pdf

Energy Information Administration (2019). Background Reference: Iran. Available at: https://www.eia.gov/international/content/analysis/countries_long/Iran/pdf/iran_bkgd. pdf

Assignment of two] واگذاری دو میدان نفتی به وزارت دفاع .(Fararoo Analytical News Agency (2012 oil fields to the Ministry of Defense]. Available at: واگذاری- دو- میدان-نفتی-به- وزارت- دفاع/https://fararu.com/fa/news/121062

101

billion 38 $] میلیارد دالر قرارداد نفت، گاز و پتروشیمي در دولت نهم امضا شد Fars News Agency (2007). 38 in oil, gas and petrochemical contracts were signed in the ninth government].

Available at: https://www.farsnews.ir/news/8601310010%20%20%20%20/3-

%D9%85%D9%8A%D9%84%D9%8A%D8%A7%D8%B1%D8%AF-%D8%AF%D9%84%D8%A7%D8%B1- %D9%82%D8%B1%D8%A7%D8%B1%D8%AF%D8%A7%D8%AF-%D9%86%D9%81%D8%AA- %DA%AF%D8%A7%D8%B2%D9%88-%D9%BE%D8%AA%D8%B1%D9%88%D8%B4%D9%8A%D9%85%D9%8A- %D8%AF%D8%B1-%D8%AF%D9%88%D9%84%D8%AA-%D9%86%D9%87%D9%85- %D8%A7%D9%85%D8%B6%D8%A7-%D8%B4%D8%AF

Constitution of the Islamic Republic of] قانون اساسی جمهوری اسالمی ایران .(Guardian Council (2011

Iran]. Available at: https://www.shora-gc.ir/fa/news/1884/%D9%82%D8%A7%D9%86%D9%88%D9%86- %D8%A7%D8%B3%D8%A7%D8%B3%DB%8C-%D8%AC%D9%85%D9%87%D9%88%D8%B1%DB%8C- %D8%A7%D8%B3%D9%84%D8%A7%D9%85%DB%8C-%D8%A7%DB%8C%D8%B1%D8%A7%D9%86

بهره برداری فازهای ۱۵ و ۱6 بعد از ۵2 ماه تاخیر، هزینه 3 میلیاردی تبدیل به .(Iran Labor News Agency (2015 Operating phases 15 and 16, after a delay of 52 months, the cost of 3] 6 میلیارد شد billion became 6 billion] Available at: https://www.ilna.news/fa/tiny/news-297654.

Iran Oil Gas Netwerk (2020). Middle East & Iran Petroleum Maps. Available at: http://www.iranoilgas.com/exclusive/map

How many companies] قرارگاه خاتم چند شرکت و پروژه اقتصادی در اختیار دارد؟ .(Iranian Economy (2012 and economic projects does Khatam al-Anbia have?]. Available at:

http://www.ireconomy.ir/fa/page/1093/%D9%82%D8%B1%D8%A7%D8%B1%DA%AF%D8%A7%D9%87+%D8%AE%D8% A7%D8%AA%D9%85+%DA%86%D9%86%D8%AF+%D8%B4%D8%B1%DA%A9%D8%AA+%D9%88+%D9%BE%D8% B1%D9%88%DA%98%D9%87+%D8%A7%D9%82%D8%AA%D8%B5%D8%A7%D8%AF%DB%8C+%D8%AF%D8%B1+ %D8%A7%D8%AE%D8%AA%DB%8C%D8%A7%D8%B1+%D8%AF%D8%A7%D8%B1%D8%AF.html

خط لوله انتقال گازهمدان- بیجار .(Iranian Gas Engineering & Development Company (2011a [Hamedan-Bijar gas transmission pipelines]. Available at: https://www.nigceng.ir/plans/Lists/List1/Untitled_2.aspx?List=613a05a1%2Dea78%2D47cf%2Db320%2D8f6779 830d5b&ID=2&Source=http%3A%2F%2Fexternal%2Enigceng%2Eir%2Fplants%2FLists%2FList6%2Fview%2E aspx&Web=619ac2bc%2Debf2%2D4d19%2Da280%2Df6d3872b12e2

خط لوله دوم خرم آباد .(Iranian Gas Engineering and Development Company (2011b [Khorramabad second gas pipeline]. Available at: https://nigceng.ir/plans/Lists/sheet1/DispForm.aspx?List=c12aa644-41ac-4cbc-ac68- f9d67e0c171d&ID=459&ContentTypeId=0x0100ABF0CE8871BA594BAF9044497504D9B3

ایستگاه هاي تقویت فشار گاز خورموج- .(Iranian Gas Engineering and Development Company (2011c .[(Third and fourth gas pressure boosting facilities (Khormuj and Deylam] دیلم به صورت Available at: https://www.nigceng.ir/plans/Lists/List/AllItems.aspx

102

We gave the] اقتصاد را به دولتی دادیم که هم تفنگ دارد و هم رسانه .(Iranian Labour News Agency (2017 .(economy to a government that has both guns and media]. ۰۱/۰4/۱3۹6 ( 22 June 2017 Available at: https://www.ilna.news/fa/tiny/news-503574.

طراحی ساخت مخازن ذخیره سازی برای اولین بار درکشور .(Iranian Oil Terminals Company (2012 [Designing the construction of storage tanks for the first time in the country].

Available at: http://www.iotco.ir/fa/newsagency/61/%D8%B7%D8%B1%D8%A7%D8%AD%DB%8C- %D8%B3%D8%A7%D8%AE%D8%AA-%D9%85%D8%AE%D8%A7%D8%B2%D9%86- %D8%B0%D8%AE%DB%8C%D8%B1%D9%87-%D8%B3%D8%A7%D8%B2%DB%8C- %D8%A8%D8%B1%D8%A7%DB%8C-%D8%A7%D9%88%D9%84%DB%8C%D9%86- %D8%A8%D8%A7%D8%B1-%D8%AF%D8%B1%DA%A9%D8%B4%D9%88%D8%B1

Iranian Privatization Organization (1997). Statistics: distribution from 1370 to 1387. Available at: http;//www.ipo.ir/index.aspx?siteid=1&pageid=525

گزارش تفصیلی عملکرد سازمان خصوصی سازی در سال Iranian Privatization Organization (2014). ۱3۹3 [Detailed report on the performance of the Privatization Organization in 2014]. Available at: https://ipo.ir/uploads/1/old/Ipo-amlakard93-p1_8913.PDF

گزارش عملکرد سازمان خصوصی سازی در سال Iranian Privatization Organization (2015). ۱3۹4 [Performance Report of the Privatization Organization in 2015]. Available at: http://ipo.ir/uploads/ipo-amalkard-94.pdf

گزارش عملکرد سازمان خصوصی سازی در سال Iranian Privatization Organization (2018). ۱3۹7 [Performance Report of the Privatization Organization in 2018]. Available at: http://ipo.ir/uploads/ipo-gozaresh%20amalkard1397.pdf

The gas] پروژه خط انتقال گاز از سرخس به درگز كلنگ زني شد .(Iranian Students’ News Agency (2006 transmission line project from Sarakhs to Dargaz was overhauled]. Available at: https://www.isna.ir/news/8412-02859/

تکمیل امضای قراردادهای اصلی پروژه ایران ال.ان.جی .(Iranian Students’ News Agency (2008 [Completion of the signing of the main contracts of the Iran LNG project]. Available at: https://www.isna.ir/news/8701-01213/

عصر امروز 7 ایستگاه تقویت فشار گاز افتتاح ميشود* راهاندازي .(Iranian Students’ News Agency (2009 This evening, 7 gas pressure boosting stations will be] رسمي فاز دوم خط لوله سوم سراسري opened. Official launch of the second phase of the third national pipeline]. Available at: https://www.isna.ir/news/8806-03874/ (September 21, 2009).

103

آغاز عملیات اجرایي احداث دو خط لوله نفتی در استان .(Iranian Students’ News Agency (2011 Starting of executive operations for the construction of two oil pipelines in]مرکزی Markazi province]. Available at: https://www.isna.ir/news/markazi-4251/

Signing 2] امضای 2 قرارداد برای اکتشاف منابع جدید نفت و گاز .(Iranian Students’ News Agency (2012a contracts to explore new oil and gas resources]. available at: https://www.isna.ir/news/91092112419/

The] توسعه میدان سومار به قرارگاه خاتم االوصیاء )ص( واگذار شد .(Iranian Students’ News Agency (2012b development of Somar Field was handed over to Khatam al-Awsiya]. Available at: https://www.isna.ir/news/91051107260/

What are Iran's future oil] غولهای نفتی آینده ایران کدامند؟.(Iranian Students’ News Agency (2016 giants?]. available at: https://www.isna.ir/news/95071811154/

The] بهره برداری از فاز سوم طرح توسعه پتروشیمی پردیس آغاز شد .(Iranian Students’ News Agency (2018 operation of the third phase of Pardis Petrochemical Development Project has started]. Available at: https://www.isna.ir/news/97061306480/

بهره برداری از فازهای ۱3 و 22 تا 24 گام عملی در تحقق اقتصاد مقاومتی .(IRIB News Agency (2019 [Exploitation of phases 13 and 22 to 24 is a practical step in realizing a resilient economy]. Available at: https://www.iribnews.ir/009zPw

متن کامل گزارش کمیسیون اصل 44 درباره واگذاری سهام .(Islamic Consultative Assembly News Agency (1998 -Full text of the report of the Article 44 Commission on the transfer of shares of state] شرکتهای دولتی متن-کامل-گزارش-کمیسیون-اصلowned companies]. Available at: https://www.icana.ir/Fa/News/186496/-44- های-دولتیE2%80%8C%درباره-واگذاری-سهام-شرکت

متن کامل گزارش کمیسیون اصل 44 درباره واگذاری سهام .(Islamic Consultative Assembly News Agency (2011 -Full text of the report of the Article 44 Commission on the transfer of shares of state] شرکتهای دولتی owned companies]. Available at: https://www.icana.ir/Fa/News/186496/%D9%85%D8%AA%D9%86-

%DA%A9%D8%A7%D9%85%D9%84-%DA%AF%D8%B2%D8%A7%D8%B1%D8%B4- %DA%A9%D9%85%DB%8C%D8%B3%DB%8C%D9%88%D9%86-%D8%A7%D8%B5%D9%84-44- %D8%AF%D8%B1%D8%A8%D8%A7%D8%B1%D9%87-%D9%88%D8%A7%DA%AF%D8%B0%D8%A7%D8%B1%DB%8C- %D8%B3%D9%87%D8%A7%D9%85-%D8%B4%D8%B1%DA%A9%D8%AA%E2%80%8C%D9%87%D8%A7%DB%8C- %D8%AF%D9%88%D9%84%D8%AA%DB%8C

قانون برنامه اول توسعه .(Islamic Parliament Research Center of the Islamic Republic of Iran (1990 ,The law of the first program of economic] اقتصادی ، اجتماعی، فرهنگی جمهوری اسالمی ایران social, cultural development of the Islamic Republic of Iran]. Available at: https://rc.majlis.ir/fa/law/show/91755

104

قانون اساسی ایران .(Islamic Parliament Research Center of the Islamic Republic of Iran (2020 The Constitution of the Islamic Republic of Iran (the] جمهوری اسالمی ایران ) کل قانون اساسی( entire Constitution). Available at: https://rc.majlis.ir/fa/law/show/132239

قانون برنامه سوم .(Islamic Parliament Research Center of the Islamic Republic of IRAN (2000 ,The law of the third program of economic] توسعه اقتصادی ، اجتماعی، فرهنگی جمهوری اسالمی ایران social, cultural development of the Islamic Republic of Iran]. 1379/01/17. Available at: https://rc.majlis.ir/fa/law/show/93301

عملیات اجرایي كارخانه گاز وگاز مایع 32۰۰ منطقه غرب كارون .(Islamic Republic News Agency (2013 The executive operation of the 3200 West Gas and Carbon Fuel Plant in the] آغازشد western Karun region has begun]. Available at: www.irna.ir/news/80518714/

The] مطالعه پنج میدان نفت و گاز به قرارگاه خاتم االنبیا واگذار شد .(Islamic Republic News Agency (2016 study of five oil and gas fields was handed over to Khatam al-Anbia camp]. Available at: www.irna.ir/news/82368697/

How is the] تامین مالی طرحهای نفتی در سال ۹۹ چگونه است؟ .(Islamic Republic News Agency (2020 financing of oil projects in 1399?]. Available at: www.irna.ir/news/83704756/

How is the] تامین مالی طرحهای نفتی در سال ۹۹ چگونه است؟ .(Islamic Republic News Agency (2020 financing of oil projects in 1399?]. Available at: www.irna.ir/news/83704756/

With the] با اجرای خط لوله ۹۰۰کیلومتری مشکل کمبود گاز طبیعی در غرب کشور مرتفع شد .(Keyhan (2007 implementation of the 900 km pipeline, the problem of natural gas shortage in the west of the country was solved]. Available at: https://www.magiran.com/article/1517921

Gas production started from phase 15] تولید گاز از سکوی فاز ۱۵ پارس جنوبی آغاز شد .(Keyhan (2015

of South Pars]. Available at: http://kayhan.ir/fa/news/33896/%D8%AA%D9%88%D9%84%DB%8C%D8%AF-

%DA%AF%D8%A7%D8%B2-%D8%A7%D8%B2-%D8%B3%DA%A9%D9%88%DB%8C-%D9%81%D8%A7%D8%B2- 15-%D9%BE%D8%A7%D8%B1%D8%B3-%D8%AC%D9%86%D9%88%D8%A8%DB%8C- %D8%A2%D8%BA%D8%A7%D8%B2-%D8%B4%D8%AF

ابالغ سیاستهای راهبردی و بسیار مهم نظام درباره بند ج اصل چهل و چهار قانون اساسی .(Khamenei (2006 [Communication of the strategic and very important policies of the system regarding paragraph c of Article 44 of the Constitution]. Available at: http://farsi.khamenei.ir/news-content?id=1400

105

The latest status of] آخرین وضعیت طرح های جمع آوری گازهای همراه .(Kharg News Agency (2009 mobile gas collection projects]. Available at: -NGL-آخرین- وضعیت-طرح- های-جمع- آوری- گازهای-همراه/http://www.khargnews.ir/fa/news/200 خارگ-به-کجا-رسید

important points about the 14] نکته مهم در خصوص فعالیت های قرارگاه خاتم االنبیاء Khatam (2017). ۱4

activities of Khatam al-Anbia Headquarter]. Available at: https://khatam.com/%DB%B1%DB%B4-

%D9%86%DA%A9%D8%AA%D9%87-%D9%85%D9%87%D9%85-%D8%AF%D8%B1- %D8%AE%D8%B5%D9%88%D8%B5-%D9%81%D8%B9%D8%A7%D9%84%DB%8C%D8%AA- %D9%87%D8%A7%DB%8C-%D9%82%D8%B1%D8%A7%D8%B1%DA%AF%D8%A7%D9%87- %D8%AE%D8%A7%D8%AA%D9%85-%D8%A7%D9%84%D8%A7%D9%86%D8%A8%DB%8C%D8%A7%D8%A1- (%D8%B5)_5297.html

projects: oil, gas, and petrochemical]. Available at] پروژهها: نفت، گاز و پتروشیمی .(Khatam (2020a https://www.khatam.com/?part=menu&inc=&id=604

:Oil and gas storage tanks]. Available at] مخازن ذخیره نفت و گاز .(Khatam (2020b html.مخازن- ذخیره-نفت-و-گاز_https://www.khatam.com/2548

The] پروژه خط انتقال گاز سرخس – درگز زمستان 8۵ به بهره برداري مي رسد .(Mehr News Agency (2006 Sarakhs-Dargaz gas transmission line project will be operational in the winter of 2007]. Available at: mehrnews.com/x4wWc

.[Privatization is halfway done] خصوصی سازی به نیمه راه رسید .(Mehr News Agency (2009a Available at: mehrnews.com/xbs5k

Sustainable] انتقال پایدار گاز غرب کشور با خط ششم سراسری تقویت خواهد شد .(Mehr News Agency (2009b gas transmission in the west of the country will be strengthened with the sixth national line]. Available at: http://mehrnews.com/x9gng

Details of the $ 10] جزئیات ۱۰ میلیارد دالر پروژه نفتی در قرارگاه خاتماالنبیا .(Mehr News Agency (2010a billion oil project at Khatam al-Anbia camp]. Available at: mehrnews.com/xcgdQ

Mehr News Agency (2010b). The contract for two gas projects was handed over to the Khatam al-Anbia camp [Khatam al-Anbia construction base builds European gas pipeline]. Available at: mehrnews.com/xcmxM

The roof of Iran's first LNG] ایران نصب شد LNG سقف اولین مخزن .(Mehr News Agency (2010c tank was installed]. Available at: mehrnews.com/xbYjp

106

Construction of] ساخت خطوط گاز اروپا و پاکستان توسط قرارگاه خاتم االنبیا.(Mehr News Agency (2010d European and Pakistan gas pipelines by Khatam al-Anbia Headquarter]. Available at: mehrnews.com/xcRvy

The contract for] قرارداد خط لوله اتیلن مرکز به قرارگاه خاتم االنبیا واگذار شد .(Mehr News Agency (2011 the central Ethylene pipeline was handed over to the Khatam al-Anbia]. Available at: mehrnews.com/xfSbq

he contract for] قرارداد توسعه دو میدان نفتی به قرارگاه خاتم االوصیا واگذار شد .(Mehr News Agency (2012a the development of the two oil fields was handed over to the Khatam al-Awsiya]. Available at: mehrnews.com/xhHcq

راه اندازی ۱5 پروژه جدید خطوط لوله نفت/ افتتاح 2 خط لوله نفتی در تهران .(Mehr News Agency (2012b [Launch of 15 new oil pipeline projects/opening of 2 oil pipelines in Tehran]. Available at: mehrnews.com/xjgQw

The] احداث ایستگاه جدید تزریق گاز گچساران 6۰ درصد پیشرفت فیزیکی داشتهاست .(Mehr News Agency (2013 construction of the new Gachsaran gas injection station has achieved 60% physical progress]. Available at: mehrnews.com/xnJBt

ساخت نخستین پتروپاالیشگاه کشور توسط قرارگاه سازندگی خاتم االنبیا .(Mehr News Agency (2019 [Construction of the first petrochemical plant in the country by Khatam Al-Anbia Construction Headquarter]. Available at: mehrnews.com/xQfjc

قانون اجرای سیاستهای کلی اصل چهل و .(Ministry of Cooperatives Labour and Social Welfare (2008 Law on the Implementation of General Policies Article 44 of the]چهارم )44( قانون اساسی Constitution]. Available at: https://www.mcls.gov.ir/fa/law/260

خط لوله گازی صلح ، نمونه بارز شعار : .(Ministry of Petroleum of the Islamic Republic of Iran (2010 The Peace Pipeline is a clear example of the slogan: We can]. available] ما می توانیم است

at: https://www.mop.ir/portal/Home/ShowPage.aspx?Object=News&ID=20aeddca-fb1f-48a4-9e94- 465ab5e41b08&LayoutID=9ee73636-0428-4f30-99af-34971f705b80&CategoryID=b37c877a-1ec5-4ae5-90a0- a36ed666ca3c&SearchKey=

Is the IRGC a rival to] آیا سپاه رقیب مردم و بخش خصوصی است؟ .(Mizan Online News Agency (2017 :June 2017). Available at 24) تير the people and the private sector?]. 03 1396 https://www.mizanonline.com/fa/news/322255/%D8%A2%DB%8C%D8%A7- %D8%B3%D9%BE%D8%A7%D9%87-%D8%B1%D9%82%DB%8C%D8%A8-

107

%D9%85%D8%B1%D8%AF%D9%85-%D9%88-%D8%A8%D8%AE%D8%B4- %D8%AE%D8%B5%D9%88%D8%B5%DB%8C-%D8%A7%D8%B3%D8%AA

Naftiran (2020). Naftiran Intertrade Company. Available at: http://www.naftiran.com/

گزارش آغاز عملیات اجرایی کارخانه گاز وگاز مایع 32۰۰ منطقه غرب کارون با حضور وزیر نفت.(Naftnews (2013 [Report on the start of the executive operation of the 3200 gas and liquefied gas plant in the western region of Karun with the presence of the Minister of Oil]. Available at: http://www.naftnews.net/print-14370.html

The] عملیات اجرایی چهار پروژه پتروشیمی توسط قرارگاه خاتم االنبیا آغاز شد .(Nasim News Agency (2014 implementation of four petrochemical projects was started by Khatam Al-Anbia]. Available at: (9 October 2014)

ساخت نخستین واحد شیرین سازی میعانات گازی در فازهای 2 و 3 پارس .(National Iranian Oil Company (2017 Construction of the first gas condensate desalination unit began in phases] جنوبی آغاز شد 2 and 3 of South Pars]. Available at: https://hse.nioc.ir/portal/home/showpage.aspx?object=relatedtopics&categoryid=40295507-1e70-49ec-af82- e5eeba6870bc&webpartid=19ffa673-9aa0-4159-a435-3d5f6d5ef58b&id=bea30a2e-f0d9-4aac-87cc-b7577416ef42

ال و سرنوشت جیهای انتشریح سناریوهای جمع آوری گازهای فلر/ طرح .(National Iranian Oil Company (2018 .[Describe the scenarios of collecting Feller gases / NGL designs and their fate] هاآن

Available at: https://www.nioc.ir/portal/Home/ShowPage.aspx?Object=News&ID=83d19ef8-5767-42ae-ad8f- 060262c20eba&LayoutID=c894037a-3add-4e0f-ac5c-a883e2a09184&CategoryID=d7d95987-15cb-4032-9f2a- be66a31b0c38&SearchKey=

The contract] قرارداد 2 پروژه لرزه نگاری پانیذ و باشت امضا شد .(National Iranian Oil Company (2019 for the two Paniz and Basht seismic projects was signed]. Available at:

https://www.nioc.ir/portal/home/?news/100193/100198/335130/%D9%82%D8%B1%D8%A7%D8%B1%D8%AF%D8%A7%

D8%AF-2-%D9%BE%D8%B1%D9%88%DA%98%D9%87- %D9%84%D8%B1%D8%B2%D9%87%E2%80%8C%D9%86%DA%AF%D8%A7%D8%B1%DB%8C- %D9%BE%D8%A7%D9%86%DB%8C%D8%B0-%D9%88-%D8%A8%D8%A7%D8%B4%D8%AA- %D8%A7%D9%85%D8%B6%D8%A7-%D8%B4%D8%AF

طرح های خطوط انتقال و ذخیره سازی .(National Iranian Oil Engineering & Construction Co. (2020 [Transmission and storage line designs]. Available at: http://www.nioec.com/Pages/Projects.aspx

Oil Industries Engineering & Construction Group (2020). OIEC at a Glance. Available at: http://www.oiecgroup.com/timeline.html

108

Oil Show Book (2017). 22nd International oil, gas, refining and petrochemical exhibition.

Available at: http://farahamtajhiz.ir/wp- content/uploads/2017/08/%D8%A7%D8%B3%D8%A7%D9%85%DB%8C- %D8%B4%D8%B1%DA%A9%D8%AA-%DA%A9%D9%86%D9%86%D8%AF%DA%AF%D8%A7%D9%86- %D9%86%D9%85%D8%A7%DB%8C%D8%B4%DA%AF%D8%A7%D9%87-%D9%86%D9%81%D8%AA- %D9%88-%DA%AF%D8%A7%D8%B2-%D8%AA%D9%87%D8%B1%D8%A7%D9%86-96-71-150.pdf

Organization of the Petroleum Exporting Countries (1999). OPEC Annual Statistical Bulletin. Available at: https://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB1999.pdf

Organization of the Petroleum Exporting Countries (2003). OPEC Annual Statistical Bulletin. Available at: https://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2003.pdf

Organization of the Petroleum Exporting Countries (2008). OPEC Annual Statistical Bulletin. Available at: https://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2008.pdf

Organization of the Petroleum Exporting Countries (2013). OPEC Annual Statistical Bulletin. Available at: https://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB2013.pdf

Organization of the Petroleum Exporting Countries (2018). OPEC Annual Statistical Bulletin. Available at: https://www.opec.org/opec_web/static_files_project/media/downloads/publications/ASB%202018.pdf

دستیابی فاز سوم شرکت پتروشیمی پردیس به ظرفیت کامل تولید .(Pardis Petrochemical Company (2018 [Achieving the third phase of Pardis Petrochemical Company with full production capacity]. Available at: https://www.paupc.ir/Index.aspx?page_=news&lang=1&sub=0&PageID=309&PageIDF=3&tempname=news

Pars Oil and Gas Company (2020). About Company. Available at: https://www.pogc.ir/Default.aspx?tabid=131

Petroiran Development Company (2020). History. Available at: http://www.petroiran.com/en/about- us/history/

تفاهم نامه طراحی و ساخت مخازن ذخیره .(Petroleum Engineering & Development Company (2011 A memorandum of understanding was signed for the] سازی زیر زمینی نفت خام امضا شد design and construction of underground oil storage tanks]. August 10, 2011. Available at: http://pedec.ir/detail=5244

109

تلمبه خانه شهید چمران اهواز به بهره برداری .(Petroleum Engineering & Development Company (2012 The pump house of Shahid Chamran House in Ahvaz will be put into] می رسد operation]. Available at: http://pedec.ir/detail=10493

پایان عملیات لرزه نگاری 3بعدی میدان نفتی بند .(Petroleum Engineering & Development Company (2013 .[End of 3D seismic operations in Karkheh oil field until spring of '92] کرخه تا بهار ۹2 Available at: http://pedec.ir/detail=16643

Petropars (2020). Petropars at a glance. Available at: http://www.petropars.com/petropars-at- a-glance

درصد سوخت خودروها توسط قرارگاه خاتم االنبیا تولید می شود Public Association News Agency (2020). 6۰ [60% of car fuel is produced by Khatam al-Anbia]. Available at: http://pana.ir/news/1020509

Increase of 200] افزایش2۰۰میلیون لیتر ی ذخیره سازی فراورده های نفتی در منطقه اصفهان.(SHANA (2005 million liters of oil products storage in Isfahan region]. Available at: www.shana.ir/news/76975/

با حضور وزیر نفت و فرمانده سپاه پاسداران، قرارداد 3/۱ میلیارد دالری احداث خط لوله هفتم سراسری .(SHANA (2006 In the presence of the Minister of Petroleum and the Commander of the] گاز امضا شد Revolutionary Guards, a $1.3 billion contract was signed for the construction of the seventh national gas pipeline]. Available at: www.shana.ir/news/84865/

Construction of four] احداث چهار تلمبه خانه جدید در مسیر خط لوله انتقال نفت خام ری- تبریز.(SHANA (2008 new pump houses on the Rey-Tabriz crude oil pipeline]. Available at: www.shana.ir/news/137854/

signing a contract for the] امضای تفاهمنامه توسعه میدان نفتی بندکرخه با بنیاد مستضعفان .(SHANA (2009a development of the Karkheh oil field with ]. Available at: www.shana.ir/news/145560/

Exploitation of LPG] فاز ۹ و ۱۰ پارس جنوبی آغاز شد LPG بهره برداری از مخازن .(SHANA (2009b tanks, phases 9 and 10 of South Pars began]. Available at: www.shana.ir/news/146939/

The first phase of the] فاز نخست خط دوم خرم آباد به خط اول سراسری گاز متصل می شود .(SHANA (2010 second line of Khorramabad is connected to the first national gas line]. Available at: www.shana.ir/news/158434/

110

The new pump house of] تلمبهخانه جدید مرکز انتقال نفت شهید چمران به بهرهبرداری رسید .(SHANA (2012a Shahid Chamran Oil Transmission Center was put into operation]. Available at: www.shana.ir/news/184692/

The tenth national line of the] خط دهم سراسری شاهکار تالشگران گاز در قلب ایران .(SHANA (2014a masterpiece of gas workers in the heart of Iran]. Available at: www.shana.ir/news/231753/

Construction of the] آغاز ساخت خط لوله انتقال فرآورده اهواز تا تهران در اواسط امسال .(SHANA (2014b Ahwaz-Tehran transmission pipeline began in the middle of this year]. Available at: www.shana.ir/news/219001/ (June 4, 2014)

four reservoir of one] چهار مخزن یک میلیون بشکه ای ذخیره سازی نفت خارگ آنالین افتتاح شد .(SHANA (2015 million barrels of Kharg have been opened]. Available at: www.shana.ir/news/240126/

The fact of the Persian Gulf Star] واقعیتهای پاالیشگاه میعانات گازی ستاره خلیج فارس .(SHANA (2017a Gas Condensate Refinery]. Available at: www.shana.ir/news/276509/

Heating system of Mahshahr] سامانه گرمایشی تاسیسات انبار نفت کوره ماهشهر افتتاح شد .(SHANA (2017b furnace oil storage facility opened]. Available at: www.shana.ir/news/281167/

The Ministry of] وزارت نفت و قرارگاه خاتم برای توسعه پتروپاالیشگاهها همکاری میکنند .(SHANA (2019a Petroleum and Khatam Camp are working together to develop petrochemical plants]. Available at: www.shana.ir/news/291569/

The study of an exploratory block] مطالعه یک بلوک اکتشافی به شرکتی ایرانی واگذار شد .(SHANA (2019b was entrusted to an Iranian company]. Available at: www.shana.ir/news/287724/

The first press conference of the new] نخستین نشست خبری رئیسجمهور جدید برگزار شد .(Tabnak (2013a president was held]. Available at: https://www.tabnak.ir/001Peq (August 6, 2013).

All the margins of the international] همه حاشیه هاي واگذاري نمایشگاه بین المللي .(Tabnak (2013b exhibition]. Available at: tabnak.ir/001P50

The contract for the] قرارداد توسعه میدان نفتی سومار امضا شد .(Tasnim News Agency (2013 development of the Somar oil field was signed]. Available at: https://tn.ai/44258

111

Details] جزئیات جدول زمانبندی توسعه فاز ۱۵ و ۱6 پارس جنوبی تا مرداد Tasnim News Agency (2014). ۹4 of the schedule for the development of phases 15 and 16 of South Pars until August 2015]. Available at: https://tn.ai/352283

To date, 900] بنگاه دولتی تا امروز به بخش خصوصی واگذار شده است Tasnim News Agency (2019a). ۹۰۰ state-owned enterprises have been divested to the private sector]. Available at: https://tn.ai/2000672

Zanganeh: They] زنگنه: میخواستند بین ما و سپاه فاصله بیندازند، ما نگذاشتیم .(Tasnim News Agency (2019b wanted to put a distance between us and the IRGC, we didn't let them]. Available at: https://tn.ai/1970578

TENCO (2020). About TENCO company. Available at: http://www.petrotenco.com/en/tenco.pdf

U.S. Department of The Treasury (2019). Treasury Sanctions Iran’s Largest Petrochemical Holding Group and Vast Network of Subsidiaries and Sales Agents. Available at: https://home.treasury.gov/news/press-releases/sm703

US Energy Information Administration (2017). “Country Analysis Brief: Iran”, U.S. Department of Energy, https://www.eia.gov/

Logically, civilly, and wisely, we are] منطقی، مودبانه و حکمت آمیز با دنیا حرف می زنیم .(VOA (2013 talking with the world]. Available at: https://ir.voanews.com/a/rouhani-hassan-first- press-conference-iran/1724290.html

World Bank (2001). Memorandum of the President of the IBRD to the Executive Directors on an Interim Assistance Strategy for the Islamic Republic of Iran. Washington, DC, World Bank, Report 22050-IRN.

Exploitation of the pump] بهره برداري از تلمبه خانه شهید چمران اهواز .( (2012b house of Shahid Chamran in Ahvaz]. Available at: https://www.yjc.ir/006ZuY

-What exactly does Khatam al] قرار گاه خاتم االنبیا دقیقا چه کار میکند؟ .(Young Journalists Club (2016 Anbia do?]. available at: https://www.yjc.ir/00Ngcj

.[Corps engagement in economic contracts] حضور سپاه در قراردادهای اقتصادی .(Zandi, R. (2006 Sharq. Available at: https://www.magiran.com/article/1117259

112

Media, newspaper, weekly journals APS (2001). Reveiw Oil Market Trends, ‘Iran – Part 2 – the oil & gas fiels & NIOC restructured’, 2 April 2001, 56:14.

Energy compass (2001). ‘’Who’s who in Iran’, 25 May 2001

Fanack (2012). Retrieved November 5,2012. Available at: /http://fanack.com/en/countries/ Iran-invisible/economy/oil-and-gas/S

Types of contracts in the oil] انواع قراردادها در صنعت نفت .(Islamic Republic News Agency (2017 industry]. available at: www.irna.ir/news/82584511/ (3 July 2017).

Mirmoezi (2004). Role of Middle Eastern NOCs in world oil industry and necessity of structural reforms and productivity. Ninth international IIES Conference, Proceedings of the Conference, Tehran, Iran (in Farsi). Available on www.iies.org.

Familiarity with the types of] آشنایی با انواع قراردادهای پروژه های خورشیدی .(Norsun Energy (2020 contracts for solar projects]. Available at: https://noursun.com/fa/%d8%a2%d8%b4%d9%86%d8%a7%db%8c%db%8c-%d8%a8%d8%a7- %d8%a7%d9%86%d9%88%d8%a7%d8%b9- %d9%82%d8%b1%d8%a7%d8%b1%d8%af%d8%a7%d8%af%d9%87%d8%a7%db%8c- %d9%be%d8%b1%d9%88%da%98%d9%87-%d9%87%d8%a7%db%8c-%d8%ae/

Waldman, P. (1992). “Clergy capitalism”. Wall Street Journal, May 5, 1992.

World Bank, 2007, “World Development Indicators Database”, April.

113

Appendixes

I. Largest prived reserve holders of crude oil and natural gas

114