(Recasts, adds details; Changes dateline to Washington)
By Yeganeh Torbati
WASHINGTON, Oct 4 (Reuters) - Iran signed the first oil output contract under a new, less restrictive model on Tuesday, Iranian oil officials were quoted as saying, with a firm identified by the United States as part of a conglomerate controlled by Iran's Supreme Leader.
Iran hopes its new Iran Petroleum Contracts (IPC), part of an effort to sweeten the terms it offers on oil development deals, will attract foreign investors and boost production after years of sanctions.
The National Iranian Oil Company signed the contract with Persia Oil & Gas Industry Development Co., an Iranian firm, according to the oil ministry's official website SHANA. (bit.ly/2dGKi8h)
The U.S. Treasury Department named Persia Oil & Gas in 2013 as part of Setad Ejraiye Farman-e Emam, or Setad, a secretive and powerful organization overseen by Iranian Supreme Leader Ali Khamenei.
With stakes in nearly every sector of Iran's economy, Setad built its empire on the seizure of thousands of properties belonging to religious minorities, business people and Iranians living abroad, according to a 2013 Reuters investigation, which estimated the network's holdings at about $95 billion. (reut.rs/1g1qkCg)
The U.S. Treasury in 2013 sanctioned Setad and 37 companies it said it oversees, calling it "a major network of front companies controlled by Iran's leadership." Those sanctions were lifted in January, as part of the historic nuclear deal reached between Iran and world powers in 2015.
Under the contract signed on Tuesday, Persia Oil & Gas will develop four oil fields and reservoirs in southwest Iran, working to increase their output from 185,000 barrels per day now to at least 260,000 bpd, said Ali Kardor, National Iranian Oil Company managing director, SHANA reported. He pegged the project to be worth $2.2 billion.
"Working with Iranian firms is easier, and the contract was signed with them more quickly," Kardor said on the sidelines of the signing ceremony in Tehran.
Naji Sadooni, managing director of Persia Oil & Gas, predicted one of the fields, Yaran, will produce 30,000 barrels of oil per day within the next three weeks, according to SHANA, calling the deal to develop the field "100 percent Iranian."
"Of course in some cases where it was needed we have used foreign goods, but mostly Iranian manufacturers have been used in this plan," Sadooni said.
Persia Oil & Gas did not immediately respond to a request for comment. In response to Reuters' findings in 2013, a Setad spokesman said at the time the information presented was "not correct," and did not elaborate.
The new Iranian Petroleum Contract, or IPC, has been delayed several times due to opposition from hardline rivals of Iran's President Hassan Rouhani. It ends a buy-back system dating back more than 20 years under which Iran did not allow foreign firms to book reserves or take equity stakes in Iranian companies.
The new IPC has more flexible terms that take into account oil price fluctuations and investment risks, a senior Iranian oil official told Reuters in November.
Oil majors have said they would only go back to Iran if it made major changes to the buy-back contracts, which companies such as France's Total or Italy's Eni said made them no money or even incurred losses.
Iranian media reports did not say why Persia Oil & Gas had been singled out for the new contract. But granting the first IPC to a firm closely linked to Khamenei could be a way around the domestic opposition, because hardliners would be less likely to challenge an agreement with a company associated with the highest echelons of power.
Khamenei said in July that no new oil and gas contract for international companies would be awarded without necessary reforms.
Iranian Oil Minister Bijan Zanganeh said Iran will sign more IPC contracts by March but declined to give details, according to SHANA. Iran's semi-official Tasnim news agency said NIOC will sign the second IPC contract on Wednesday.
OPEC member Iran seeks to raise its crude output to pre-sanction levels of 4 million bpd.
"Iran's crude oil production capacity must reach 5.2 to 5.7 million bpd in the future," Kardor said on Monday, according to SHANA. (Additional reporting by Babak Dehghanpisheh in Beirut, editing by Michael Williams and Cynthia Osterman)