The Non-Governmental Oil Industry Guarantee Fund aims to address one of the bottlenecks in financing upstream oil industry projects, with a capital of 300 million euros. This plan was reviewed and approved at the twenty-fifth meeting of the National Financing Council, attended by Hamid Bord, CEO of the National Iranian Oil Company.
Purpose and Necessity of Establishing the Fund
The establishment of this fund, as an initiative by the National Iranian Oil Company, is designed to provide the guarantees and collateral required by Iranian companies in the money and capital markets. According to conducted studies, the existing limitations in providing the guarantees demanded by banks and financial institutions are considered one of the main obstacles to mobilizing financial resources for the implementation of developmental projects in the oil industry. For this reason, the Non-Governmental Oil Industry Guarantee Fund is designed to facilitate the provision of the necessary guarantees and collateral for Iranian companies and to assist in financing upstream oil and gas projects.
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Shareholder Composition and Fund Structure
The Non-Governmental Oil Industry Guarantee Fund will be established with the participation of 20 shareholders, including five commercial banks, 10 Iranian exploration and production companies, the National Development Fund, the National Iranian Oil Company, the Iran Energy Exchange, the Oil Industry Research and Technology Fund, and the Kish Free Zone Organization. According to the anticipated structure, banks and exploration and production companies will provide the majority of the fund's capital.
The presence of the CEO of the National Iranian Oil Company at this meeting and the pursuit of obtaining initial approval for this fund demonstrate the strategic importance of creating modern guarantee and financing infrastructures for the development of oil and gas fields and strengthening the capacity of Iranian companies in executing upstream projects. Given the growing role of Iranian exploration and production companies in recent years and the delegation of more responsibilities to these companies, access to financial resources and the ability to provide valid guarantees to banks and the capital market have become one of the main requirements for increasing investment capacity in the oil industry.
The establishment plan for the guarantee fund is an institutional response to this need and a complementary link in the financing chain of upstream projects. The scope of the fund's activities is also very broad and includes the issuance of various guarantees required by the oil and gas industry, prioritizing the upstream sector. These guarantees will include payment commitment guarantees, participation in tenders and auctions, performance guarantees, advance payment guarantees, issuance of securities in the capital market, foreign financing guarantees, and other guarantee instruments.
The beneficiaries of this fund will include investing companies, contractors, and operators active in the oil, gas, and petrochemical sectors. Additionally, banks and other financial institutions can benefit from the guarantees issued by the fund as collateral-eligible entities. Previously, the founding assembly of the Non-Governmental Oil Industry Guarantee Fund was formed on February 17, 2025, and with the approval of the relevant documents, the process of obtaining permits, registration, and initiating the fund's activities has entered the implementation phase. Obtaining initial approval from the National Financing Council is another step in completing the process of launching this specialized institution and providing the groundwork for its activities.
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