Daily Telegraph: The chief executive of oil and gas giant Royal Dutch Shell, Jeroen van der Veer, said the company would press ahead with feasibility studies on multi-billion-pound investments in Iran, risking the wrath of the United States government and a public backlash in the UK following the British hostage crisis. The Daily Telegraph
By Russell Hotten, Industry Editor
The chief executive of oil and gas giant Royal Dutch Shell, Jeroen van der Veer, said the company would press ahead with feasibility studies on multi-billion-pound investments in Iran, risking the wrath of the United States government and a public backlash in the UK following the British hostage crisis.
Mr van der Veer said yesterday that he was pleased that the British sailors had been released. “That’s good news, especially for the families and also politically,” he said.
Shell “will take political considerations into account” when it comes to make a final decision on Iran, but company sees no reason to terminate discussions with Teheran. “We’re doing our preparations,” he said at a conference in Paris.
In January, Shell and Spain’s Repsol signed a preliminary agreement with Iran for a $10bn (£5.1bn) development of two phases of the huge South Pars natural gas field.
Reports from Iran yesterday said that six firms had applied for tender details to develop 17 oil blocks in Iran. Shell was interested in the blocks, but it was not clear last night if it was among the six.
Oil and gas companies in the US are barred from investing in Iran, and the UK’s BP is thought to have decided against operating in the country.
Officials in Washington have warned that Shell could face action if it commits to Iran, and the hostage crisis will add pressure on the company not go ahead.
A Shell spokeswoman said yesterday that the company “continues to hold various discussions with international governments… No decisions have been made and might not be for at least a year”.
Neither The Department of Trade and Industry nor the Foreign Office returned calls yesterday.
There has been speculation that Shell might struggle to raise money for any large investment in Iran. But Mr van der Veer said he was unconcerned about the possibility that western banks are wary about backing Iranian ventures. “For Shell, project finance is only a secondary consideration, because in the end, we are the risk takers,” he said.
Shell, like some other energy companies, faces a long-term struggle to replace oil reserves. Last year, the company extracted almost twice as much oil as it found. Gas projects such as those on offer in Iran may therefore become increasingly important to the company.