Japanese oil developer Inpex Corp. said it would withdraw from Iran’s Azadegan oil field project, a move believed to be aimed at keeping it off a list of firms subject to US sanctions.
Inpex “has reached an agreement with Iran’s state oil company that its subsidiary will withdraw from the Azadegan oilfield development project,” the Japanese government-backed company said in a statement.
The oilfield, which has about 42 billion barrels of oil, was initially to have been developed with Inpex. But the Japanese company in 2006 lowered its stake from 75 per cent to 10 per cent due to worries about the risk of sanctions imposed on Iran over its controversial nuclear programme.
Last month Japan imposed new sanctions on Iran, including an assets freeze on people and entities linked to the nuclear programme and tighter restrictions on financial transactions.
The steps followed Tokyo’s approval of punitive measures in line with a UN Security Council resolution in June, which slapped a fourth set of sanctions on Iran for its refusal to halt uranium enrichment work.
The US and several other nations fear Iran is developing a nuclear arsenal under cover of its atomic energy drive, a charge Tehran denies.
The Japanese pullout is aimed at avoiding Inpex’s inclusion on a list of companies subject to US sanctions against Iran, local media including the Nikkei business daily have reported, citing government sources.
Inpex did not refer to US sanctions as a reason for the withdrawal. Spokesman Kazuya Honda only said the company had “consulted with the government since it imposed its own sanctions on Iran.
“The company then made the decision after studying the business environment comprehensively.”
But analysts said the Iranian project “was never particularly attractive” to the Japanese firm.
“Azadegan as a Japan ‘development’ project has been dead for more than four years,” said Ben Wedmore, a commodities analyst at MF Global. “It was merely a matter of time before the last 10 per cent was allowed to go.”
“I think the recent announcement of US sanctions being imposed is a very convenient excuse for Inpex to leave the project completely.”
Mr Wedmore added that Iran “is an important supplier of oil to Japan and nobody has suggested that they stop supplying”.
Other Japanese companies are also reviewing their Iran operations.
In August Toyota suspended auto exports to Iran indefinitely in line with global sanctions against Tehran.
Tokyo’s fresh sanctions against Tehran, announced in early September, included a freeze on the assets of 88 companies, banks, state agencies and other entities and of 24 people linked to Iran’s nuclear programme.
Japan has also suspended any new oil and gas investments in Iran, but there are no plans to restrict imports of crude oil from the Islamic republic.