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U.S. energy companies are the ones suffering the most from the consequences of U.S. sanctions on Iran, the country’s Energy Minister Bijan Zanganeh said today in Vienna.
"I don't understand why U.S. companies cannot enter the Iranian market. They cannot get involved in the biggest oil projects in the world, taking place here in Iran," Zanganeh said, adding that companies from other countries were inking agreements to invest in Iran’s oil and gas industry.
Perhaps the most notable of these companies is French Total, which earlier this year committed around US$1 billion to the development of the giant South Pars offshore gas field. The French company recently said it continued to be committed to the development of the field and had already pledged US$66 million to the start of Phase 11 of the field’s development.
However, in less than a month, U.S. legislators will decide whether it will reimpose sanctions, after President Trump refused to certify that Iran was compliant with the nuclear deal it sealed with six Western powers two years ago, which allowed it to return to the global oil and gas scene.
These sanctions, if they return, will most likely be unilateral: Western European countries have indicated that as far as they are concerned, Iran was playing by the rules. However, they will just as likely affect Total, which has a substantial presence in the U.S., making the company vulnerable to the sanctions.
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Besides Total, however, there are Russian and Chinese companies that have expressed interest in developing Iran’s oil and gas resources, including CNPC, Lukoil, and Gazprom. Indian energy players are also eager to expand abroad, and Iran is one destination for them.
Iran is also working with its neighbor Iraq on the joint development of several large fields that the two countries share. The warming of bilateral relations is particularly important for Tehran in light of renewed hostility from Riyadh.
Iran produced 3.82 million bpd of crude in October—the latest month for which there is OPEC data—and exported some 2.3 million bpd of this.
By Irina Slav for Oilprice.com
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Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.