Sanctions Deny US Companies Oil, Gas Opportunities in Iran

EghtesadOnline: On the verge of the first international tender to develop Iran's oil and gas fields, Amirhossein Zamaninia, deputy oil minister for international affairs, said that Tehran has imposed no restriction for US oil firms willing to participate in energy projects in the country, but it is American sanctions that make such cooperation impossible.

News ID: ۷۷۳۷۶۴

07 February 2017

On the verge of the first international tender to develop Iran's oil and gas fields, Amirhossein Zamaninia, deputy oil minister for international affairs, said that Tehran has imposed no restriction for US oil firms willing to participate in energy projects in the country, but it is American sanctions that make such cooperation impossible.

“Iran is open to cooperate with US companies in its key petroleum industry, yet as long as the so-called primary US sanctions, which bar direct or indirect trade between Iranian and American individuals or entities, are in place, US firms cannot play any role in Iran's oil and gas industry," Zamaninia was quoted as saying by IRNA.

According to Zamaninia, the National Iranian Oil Company will announce new contracts to develop oil and natural gas in mid-February in the first such tender since the lifting of international sanctions a year ago, Financial Tribune reported.

Reportedly, the plan was to hold the first tender at the end of January, but it will be held with a two-week delay.

Commenting on the delay, Zamaninia said, "Iran is a country with various political parties that is why reaching consensus on critical issues such as oil contracts will take time. Nonetheless, plans are in place to hold the first tender in the near future."

Downplaying the impact of new US-imposed sanctions against Iranian individuals and entities, the official noted that the latest sanctions have had no effect on ongoing talks between NIOC and Asian and European companies.

"They are still keen to do business with Iran and develop the key oil and gas sectors," he said.

US President Donald Trump on Friday imposed new sanctions on 25 Iranian individuals and entities that he claimed are related to the country's missile program.

Senior officials have often said that Tehran has no constraint in doing business with US-based companies, stressing that restrictions imposed by Washington are holding back American companies from lucrative investment opportunities in Iran's economy and energy sectors.

"We would very much like to see the primary sanctions lifted and we think that there is a great potential for President Trump as a non-conventional politician to review and revise the situation," Zamaninia said.

According to the deputy oil minister, rekindling trade relations with Iran would be "a great benefit for the American people, for creating jobs there in the US, for revitalizing the oil and gas business there … there is great potential for engagement and partnership in Iran for American companies."

Zamaninia believes that Iran should pump more crude oil and natural gas than its current output levels because it has the largest reserves of hydrocarbons in the world.

"As a country that has the largest reserves, we do not produce enough compared to others. The potential is great, the cost for production is low in Iran. The question is not just the potential to produce, it is also the dynamics of the international markets in the oil and gas business."

Iran, OPEC's No. 3 oil producer hopes to draw foreign companies to invest and help boost output after years of under-investment.