Iran re-establishes relations with energy gians

By Azernews

By Nigar Abbasova

Commercial relations between Iran and world energy giants, which deteriorated following the international sanctions imposed on the country, turn to normality in the wake of easing of sanctions and implementation of the Joint Plan of Action (JCPOA).

Iran’s National Petrochemical Company (NPC) and Royal Dutch Shell Company signed a preliminary memorandum of understanding (MoU) on October 9 for cooperation in the petrochemical industry, SHANA agency reported.

The head of the department for Iran affairs at Shell, Hans Nijkamp, said the signing of the deal came after months of negotiations between the two companies, adding that the sides may implement joint projects in the petrochemical field, while the document will provide a framework for strengthening cooperation.

Iran’s deputy oil minister and CEO at NPC Marzieh Shahdaei, in turn, said Iran plans to expand its petrochemical output from the current level of 60 million tons to 160 million tons by 2025.

A delegation from Shell Company visited Iran last year and discussed aspects of cooperation with the Islamic Republic in the sphere of petrochemicals.  

Shell was earlier involved in the development of Iran’s Soroush and Norouz oil fields in Persian Gulf waters.  Moreover, it was also planned to develop a gas liquefaction project, known as Persian LNG in Iran’s South Pars energy zone. The company, however, later canceled its plans following imposition of the sanctions.

Sanction pressures on Iran started easing after the United Nations confirmed compliance with a multilateral nuclear agreement, while progress in nuclear talks between Iran and the 5+1 group of countries triggered hopes that energy giants may return to Iran.

From the early days of the nuclear deal, representatives of major companies engaged in oil industry visited Tehran and voiced interest in the resumption of the ties cut-off and stalled for years.

Iran has been trying to claw back its market share since international sanctions were lifted in January and regain its major buyers.

 Royal Dutch Shell became the second major oil firm after French Total to restart trade with Tehran after the lifting of sanctions. Re-establishing relations with Shell is considered to be one of the major steps Iran in its bid to regain its footing in the global energy sector.

The country produced 46.4 million tons of petrochemicals last year, while the figure is planned to reach the level of 54.7 million tons.