This bug was fixed in the package open-iscsi -
2.0.873+git0.3b4b4500-14ubuntu3.4

---------------
open-iscsi (2.0.873+git0.3b4b4500-14ubuntu3.4) xenial; urgency=medium

  * d/p/08_Parse-origin-value-from-iBFT.patch
  * d/p/09_Represent-DHCP-origin-as-an-enum-not-a-string.patch
  * d/p/10_iBFT-origin-is-an-enum-not-a-string.patch
      - Cherry pick upstream patches to parse IP origin passed in by IBFT.
        iscsistart -f will now display the correct iface.bootproto
        (e.g. static or dhcp) (LP: #1684039)

  * d/extra/initramfs.local-top: When booting from iBFT,
    set the PROTO= entry in /run/net-*.conf accordingly,
    so that other tools, such as cloud-init, can use that
    information. (cloud-init fails if the current PROTO=none
    is used.) (Closes: #866213)

 -- Trent Lloyd <[email protected]>  Fri, 23 Jun 2017 18:03:36
+0800

** Changed in: open-iscsi (Ubuntu Xenial)
       Status: Fix Committed => Fix Released

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https://bugs.launchpad.net/bugs/1684039

Title:
  iBFT network configuration does not correctly populate PROTO=dhcp in
  /run/net-*.conf which breaks cloud-init

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