Iran Economy NewsJapan to withdraw from Iran oil project: reports

Japan to withdraw from Iran oil project: reports

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AFP: The Japanese government and oil developer Inpex Corp. plan to completely withdraw from Iran’s largest onshore oil field project to avoid possible US sanctions, news reports said Thursday.

TOKYO (AFP) — The Japanese government and oil developer Inpex Corp. plan to completely withdraw from Iran’s largest onshore oil field project to avoid possible US sanctions, news reports said Thursday.

The move, which may be announced this week, is to prevent government-backed Inpex being included in a list of companies subject to US sanctions against Iran, the Yomiuri Shimbun and the Nikkei reported, citing government sources.

Iran’s Azadegan oilfield, which has some 42 billion barrels of oil, was initially to have been developed with Inpex.

The Japanese company in 2006 significantly lowered its stake from 75 percent to 10 percent over fears of possible sanctions on Tehran over its controversial nuclear programme.

“There are various risks, as we were asked by Iran to invest more in the project,” an anonymous government official told the Yomiuri.

Japan’s Trade Minister Akihiro Ohata told reporters Thursday he has been told that Inpex was considering withdrawing from the project.

“I have heard that it is considering that as a managerial policy,” Kyodo news reported him as saying.

If Inpex appears on the list of companies subject to sanctions, it would restrict its access to the US market and could affect Japan’s other development programmes in the Middle East and Africa.

Washington and several other nations fear Iran is developing a nuclear arsenal under cover of its atomic energy drive, a charge Tehran denies.

Earlier this month Japan imposed new sanctions against Iran, including an assets freeze on people and entities linked to the nuclear programme and tighter restrictions on financial transactions.

The steps came a month after Tokyo approved punitive measures in line with a UN Security Council resolution in June which slapped a fourth set of sanctions on Iran over its refusal to halt uranium enrichment work.

Inpex spokesman Kazuya Honda said the company has yet to decide on whether to withdrawal from the project.

But he added: “After Japan imposed sanctions on Iran on September 3, the government told us to deal with the project with great care. So it’s our policy to closely consult with the government over this project.”

Iran is the fourth-biggest oil supplier to resource-poor Japan.

Other Japanese companies are also carefully reviewing their Iran operations.

In August Japanese auto giant Toyota suspended auto exports to Iran indefinitely in line with global sanctions against Tehran.

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