Page 60 - IRANRptNov19
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9.2 Major corporate news 9.2.1 Oil & gas corporate news
US grants new sanctions waiver at North Sea field part-owned by Iran’s national oil company
Iran sells products on IRENEX
The US has renewed a sanctions waiver for the Rhum gas project in the UK North Sea that is part-owned by Iran’s national oil company, its London-based partner Serica Energy confirmed on October 24.
The renewal, provided by the US Office of Foreign Assets Control (OFAC), allows “certain US and US-owned or controlled entities and also non-US entities to continue providing goods, services and support to Rhum” until February 28, 2021.
The waiver was first granted a year ago after US President Donald Trump imposed new sanctions on Iran, following his decision to pull Washington out of the 2015 multilateral nuclear deal. The waiver had been due to expire at the end of October. The extension enables Serica to continue operations at the Rhum field unaffected, the company said.
“The receipt of the renewed and extended licence and assurance is an excellent outcome which protects this valuable British asset,” Serica CEO Mitch Flegg commented, thanking UK authorities for their support.
Rhum was the third largest source of gas production on the UK continental shelf in the second quarter, according to Flegg, flowing at a rate of 28,400 barrels of oil equivalent per day. Serica owns a 50% stake in the project which itacquiredfromB PinNovemberlastyear.TheNationalIranianOilCompany (NIOC) owns the remaining half, but its revenues from this share go into an escrow account in London that Tehran cannot access.
Rhum’s development has been marred by NIOC’s involvement in the project. BP had to halt production in 2010 after the EU and UK introduced new sanctions on NIOC. It was only cleared by UK authorities to resume operations three years later. The UK major deferred investment at the site last year after the US withdrew from the nuclear deal and announced plans to bring sanctions on Iran back into force.
The BP-led Shah Deniz gas field in Azerbaijan, in which NIOC’s Swiss-based subsidiary NICO has a 10% stake, has also secured a sanctions waiver from the US. Iranian funds are likewise deposited in an escrow account in the Cayman Islands.
Iranian state broadcaster IRIB reported that the National Iranian Oil Co. (NIOC) had sold 450,000 tonnes of oil products to foreign buyers over the Iran Energy Exchange (IRENEX) last month.
It said that the goods were valued at a total of $160.6mn.
The report said that the products were: 168,000 tonnes of gasoline ($64.3mn), 162,500 tonnes of gasoil ($73.9mn), 20,000 tonnes of kerosene and 50,000 tonnes of liquefied petroleum gas (LPG). Values were not given for the kerosene and LPG.
Tehran has been experimenting with selling crude over the exchange in response to the US ramping up pressure on Iranian oil customers to reduce shipments, with oil products joining the slate in recent months. It has held offerings of light and heavy crude on IRENEX since October 28 last year as it tries to provide a variety of sales mechanisms to appeal to buyers.
In an effort to entice more buyers, the Ministry of Petroleum (MoP) cut the minimum purchase order for the June 11 offering from 35,000 barrels to 1,000 barrels for land delivery, while the clearance period for payments has been extended from 60 days to 90. Cargoes can either be delivered by sea at the
60 IRAN Country Report November 2019 www.intellinews.com
