Foreign Firms Size Up Iran Market

Date: 06 February 2015 - 20:57

News ID: ۱۰۶۳۱

By: Kayhan Int’l Staff Writer

The groundwork for presence of oil giants is being laid in the Iranian capital and it’s official.
According to Oil Minister Bijan Namdar Zangeneh, world oil giants, including Royal Dutch Shell, British Petroleum, Malaysia’s Petronas, Spain’s Repsol, France’s Total and Italy’s Eni have shown interest in returning to the Iranian market following the relief in sanctions. Asian firms, likewise, are waiting to pounce on Iran’s oil and gas projects once sanctions are fully lifted.
Companies based in Europe, many of which departed Iran only in the past four years as sanctions tightened, have been most conspicuous in jockeying to return - leaving American firms behind.
Minister Zangeneh says numerous negotiations have been held with international entities recently over their participation in Iran’s oil and gas projects. "These companies are waiting for the sanctions to be lifted so that they can swiftly sign deals. America and its (regional) allies are trying with all their power to impede our work,” he says.
Western oil executives have met Zangeneh during OPEC’s meetings in Vienna, including Italy’s Eni, Royal Dutch Shell and Austria’s OMV. "There is good work going on in the South Pars and western fields for gas and oil production. It’s not such that we should wait for the sanctions to be lifted. We are continuing our work in line with the resistance economy policies,” the Iranian official maintains.
Judging by the tone of recent pronouncements, it is evident that the world oil giants are indeed ready to snag Iran’s oil and gas projects. Iran holds the world’s third-largest proven oil reserves and the second-largest natural gas reserves, and plans to use foreign companies for various energy projects. The country’s total in-place oil reserves have been estimated at more than 560 billion barrels, with about 140 billion barrels of extractable oil.
But that’s not all. Iran has 76 million people, about the same number as Turkey. It produces twice as many cars as Turkey, according to the Paris-based International Organization of Motor Vehicle Manufacturers. It consumes more steel annually than either the UK or France, according to the World Steel Association. And the Tehran Stock Exchange has a market capitalization of about $135 billion.
That explains why the prospect of a final comprehensive nuclear deal between Tehran and the six powers has already intensified competition between Russian, Chinese and Western companies over the Iranian market.
So in summary, Chinese and Russian companies doing business in Iran could soon face new rivals from the West. Last year’s annual oil, gas and petrochemicals exhibition in Tehran, which attracted 600 foreign companies, is testimony to this new market competition. A concrete new business is being generated in Iran and there is no going back.