Decree No H45880T/214287 of January 23, 2012 - On General Conditions, Structure and Template of Upstream Oil and Gas Contracts

Last updated: 23 December 2020

This decree was amended by Decree No H52087T/43465 of July 5, 2016, and it formally established the Environmental Impact Assessment (EIA) framework in Iran. EIA is defined as a study designed to predict and identify the potential environmental effects of a project.  

This regulation requires projects to comply with safety, health, environmental and social provisions. It also states that the EIA report and related environmental management plan are mandatory steps in the request for a permit.

Article 2 requires parties to conduct an EIA process while site selection and feasibility studies are in progress. Parties must submit the report to the Department of the Environment in order to obtain an official permit before undertaking any operations.

According to Article 8, the first party to the contract, who is the grantor of the right to explore and produce, usually instructs the second party to develop an environmental management plan.

Article 11 provides National Iranian Oil Companies’ (NIOC) subsidiaries means to participate in operations and in production developments. If the NIOC considers such a partnership necessary, the second party and the NIOC subsidiary shall enter into a joint operating agreement. Nevertheless, the responsibility for conducting the EIA falls on the second party.

The amendments to this decree have allowed contractors to rely on international regulations or industry best practices when elaborating and implementing environmental impact management plans.

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