Iran Warns Foreign Firms to Complete Energy Deals

A031190629.jpgIran warned foreign oil and gas firms on Sunday that it will implement major projects with domestic companies alone if they do not speed up the completion of negotiations. Caretaker Oil Minister Gholam Hossein Nozari said the signing on Sunday of a subcontract for Iran’s first liquefied natural gas (LNG) plant with an Iranian contractor showed that Tehran was prepared to ignore foreign partners.

His comments come amid growing pressure from Washington and pro-US EU countries on energy giants to reduce their new business with Iran.

“The implementation of the Iran LNG project (by Iranian companies) bears a message… If we do not reach a final agreement with those (foreign) companies, we will head in this direction,” Nozari told reporters.

“It is a warning to all foreign companies,” Nozari said on the sidelines of the signing ceremony.

The plant in the city of Assalouyeh is part of the project to develop Iran’s giant South Pars gas field which has until now attracted considerable foreign interest.

Nozari noted the development of the two major oil fields of Azadegan and Yadavaran was held up by long negotiations with Japan’s Inpex and China’s Sinopec respectively.

However Nozari denied that Iran was awarding contracts to domestic firms because of US sanctions over its nuclear program, saying it was the foreign firms who were losing out rather than the Islamic republic.

“In fact, these policies affect foreign companies and our decision to accelerate projects is not because of (US) sanctions.”

In July, a group of powerful US pension funds voiced concern about eight foreign energy firms doing business in Iran, saying political pressure is building in the United States for them to divest their stakes.

Iran has given Royal Dutch Shell and Total, who were both on the list, a deadline of June 2008 to announce their final investment decisions on two LNG projects.

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