Iran Cuts Oil Rights to 10%

A01941111.jpgTEHRAN (Fars News Agency)- The Japanese government acknowledged Friday that Inpex Corp. has agreed to reduce its interests in the development of Iran’s Azadegan oil field to 10 percent from the current 75 percent after days of talks over the stalled $2 billion deal.

“It is an appropriate decision for the management,” Katsujiro Kida, executive senior vice president of the Japanese government-affiliated Inpex, said Friday.

The Japanese government, which has been torn between the crucial oil project and the US calls for sanctions against Iran for its nuclear program, took the news coolly.

“It is better than losing all rights,” said an official with the Ministry of Economy, Trade and Industry. “If the circumstances change, (Japan) could raise the percentage.”

The Japanese government has been unable to offer official assistance to the development of Azadegan project out of concern for the United States’ hard stand against Iran.

Sources said that Inpex’s settling for a 10 percent interest is seen as a welcome development.

Behind the optimism is the Japanese government’s calculation that Iran would not be able to proceed with the project if it shuts Japan out completely, sources said.

Experts believe that developing the oil field–one of the largest in the Middle East with an estimated 26 billion barrels of oil reserves–would be difficult for Iran technologically and financially, but possible.

Iran’s Shana news agency, which is affiliated with Iran’s oil ministry, on Thursday quoted Gholam Hosein Nozari, managing director of National Iranian Oil Co., as saying that the Japanese company will play no part in developing the Azadegan oil field because of the decline in interests.

But letting Inpex retain 10 percent, the Iranian official said, is designed to keep the door open for future trade and cooperation.

Trade minister Akira Amari said Friday morning that it was “possible” that Japan’s interests in Azadegan would fall, even though he did not confirm the news agency’s report.

Meantime, sources said that Iranian companies enjoy the capabilities required for the development of the field and that the same idea has persuaded Iranian officials to put Inpex aside, after the Japanese stopped short of commencing the project.

Japan’s Inpex Corp. was granted a concession to develop Azadegan, one of the largest oil fields in the world, with expected production of 260,000 barrels a day. But, to comply with the US demands, Inpex failed to start by the deadline, which was pushed back repeatedly, from the originally set Aug. 22 to Sept. 15, and then to last Saturday.

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