Iran Economy NewsIran’s DANA Contract, Corruption, and Damage to the People

Iran’s DANA Contract, Corruption, and Damage to the People


The UAE energy company DANA Gas announced on September 28, 2021, that an international arbitral tribunal has ruled that the Iranian government pay a $607.5 million fine to the company.

This dispute is related to a 25-year gas purchase agreement between DANA Gas Company, a subsidiary of Crescent Petroleum, and the regime’s National Iranian Oil Company. DANA Gas says the gas was never delivered.

The damages, which followed a ruling in Dana’s favor in 2014, relating to the first eight and a half years of the 25-year agreement, which was due to begin in 2005. DANA Gas said in a statement that the last hearing of the much bigger claim for the remaining 16.5 years was scheduled for October next year in Paris and that a decision on the case would be made in 2023.

The Crescent contract is a contract signed between The National Iranian Oil Company (NIOC) and Crescent Inc. during Mohammad Khatami’s government, during the Oil Ministry of Bijan Namdar Zanganeh, initial negotiations began in 1997 and eventually led to the signing of the joint memorandum of understanding in 2001.

After reviewing the regulatory bodies, determined that the price of Iranian gas exports was very low and nearly to be gratis. A lawsuit has also been filed for violators of this contract in Iran but without any progress, as many of the violators are high-ranked people of the ruling body.

High-damaging and tainted contracts such as Crescent, Total, Acetate Oil, etc. have often involved bribes, for example, Total is accused of giving $30 million in bribes to a team headed by Mehdi Hashemi during the Zanganeh Ministry in Khatami’s government.

Total was therefore sentenced in a French court to a fine of 500,000 euros. Despite this dark past, another contract was re-signed with Total under Rouhani’s administration, which ended only in the presentation of the South Pars reservoir’s secret information to Total and Total’s subsequent break, while the French company is simultaneously operating extensively in the Qatari part of this large reservoir and has now gained access to Iran’s valuable information about South Pars.

The then President Hassan Rouhani, in 2002 as the secretary of the Supreme National Security Council, in a letter addressing the head of the government at the time (Khatami), described the action of the Minister of Petroleum (Zanganeh) in concluding a contract with the Emirati company Crescent outside the framework of the law, through ‘intermediaries’ and facing many negative effects for the country.

In that letter, Rouhani stressed, ‘Signing a long gas contract with an unreliable company that, according to reports received from the Oil Ministry, has performed poorly over the past years, and with the disregard for Iran’s rights about the Mubarak oil field, is a repetition of the bitter experience that we have been through for many years.

‘The price and contractual terms negotiated are very low and unpopular compared to the region. The Crescent deal is likely to have long-term negative economic impacts on the country’s gas market and will not have any political benefits. Since about a year ago, I have raised questions from the oil minister about the Crescent contract, which despite your order, no response has been received. The contract has been signed through intermediaries and lack of direct governmental communication with an invalid company.’

Then surprising in his presidency Hassan Rouhani appointed Bijan Zanganeh as the minister of oil. With a case of the elimination of the fuel card for four years during this management, period destroyed transparency and intensified the consumption (smuggling) of 20 million liters of gasoline per day, considering 100 billion tomans of smuggling per day, pouring 144 trillion tomans out of people’s pockets into the throats of government’s affiliated smugglers working for the IRGC.

After that, the regime’s shocking decision to suddenly triple the price of gasoline occurred in November 2019, which ended with the November 2019 protests with 1500 protesters killed by government forces.

There were many margins around this contract, including in 2013 a bi-national Iranian living in Britain named Abbas Yazdanpanah Yazdi, who was a friend of Mehdi Hashemi, son of Rafsanjani, was abducted shortly before testifying in the Crescent case in Dubai. And then killed. The prosecutor of the Dubai Criminal Court announced that Yazdanpanah had given evidence about the Crescent contract to the Hague Tribunal shortly before his abduction via internet call.

According to a video released by Iran’s principlist faction, Abbas Yazdanpanah had released the names of those involved in the mafia case, adding that a company called Jabal, represented by Mehdi Hashemi, was formed, seeking a stake in oil contracts with multinational corporations.

According to the evidence, Mehdi Hashemi was one of the initial negotiators of the contract for the sale of gas to Crescent but was later marginalized and did not play a role in the final signing of the contract.

Now, a few years later, it seems that not only none of these government officials have done any good for the Iranian people, but today the Iranian people must pay the price for theft, bribery, and incompetence of the officials by paying heavy compensation. At the same time, the Iranian people are struggling to make ends meet under the burden of poverty, high prices, and inflation.

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