Page 48 - IRANRptNov18

on October 30.
In a regulatory filing, Hyundai E&C said the consortium it led for the project’s construction in the southern Bushehr province scrapped the contract on October 28, stating: “The contract was canceled because financing is not complete—which was a prerequisite for the validity of the contract—as external factors worsened such as economic sanctions against Iran.”
The project was part of a wider investment into the country by the Korean firm. Hyundai’s auto arm previously confirmed that it was pulling out of the Islamic Republic due to US pressure and impending sanctions from Washington. US sanctions against Iran’s oil, gas and petrochemical industries are due to take effect on November 5, while sanctions that hit the country’s automotive and other sectors came into force in early August.
In March 2017, Hyundai Engineering Co. (Hyundai ENG) and Hyundai E&C jointly won a $3.2bn deal in all from AHDAF. Depending on the proportion of construction, Hyundai ENG and Hyundai E&C were expected to ring up $2.7bn and $525.4mn in sales from the deal.
The newspaper report stated that in general with such contracts a client pays 15% of construction costs in advance and raises finance for the rest, but the deal was now off as AHDAF was having trouble with the financing.
An official from the Iranian construction industry said: “The companies have not suffered a loss at the moment because they haven’t put money into the construction yet. However, they must be devastated internally over the drop in the order backlog."
Top Turkish refiner Tupras is reportedly in talks with US officials to obtain a waiver permitting it to keep buying Iranian oil after Washington reinstates sanctions on the Islamic Republic’s oil, gas and petrochemical sectors on November 5.
Oil industry sources were on October 21 quoted by Reuters as saying Tupras has joined other waiver seekers such as Indian energy officials queuing to obtain special Trump administration exemptions to continue importing Iranian crude shipments without fear of penalty.
With few energy natural resources of its own, Nato member Turkey depends heavily on oil and gas-rich neighbour Iran to meet its energy needs. During 2017, Iran was Turkey’s top crude oil source, accounting for 11.5mn tonnes of its total purchases of near 26mn tonnes, followed by Iraq and Russia.
During the Barack Obama administration, when multilateral sanctions were brought to bear on Iran—as against the unilateral measures introduced by Donald Trump—sanctions waivers on Iranian oil imports were in the 2013-2015 period granted to countries that reduced their intake by at least 20%.
This time round, US Treasury Secretary Steven Mnuchin has said Washington is going to take a less generous approach, while White House National Security Advisor John Bolton has said any waivers would be “few and far between”. Mnuchin said on October 21 that a reduction by a minimum one-fifth would not be good enough and that, in the longer term, importers of Iranian oil with waivers would be expected to join the drive to reduce crude shipments from Iran to zero.
Three Iranian firms have signed a €600mn contract to build a new oil storage facility at Bandar-e-Jask Port on the Gulf of Oman, the official news agency of Iran’s oil ministry, SHANA, has reported.
In early September, President Hassan Rouhani announced that Iran was planning to replace its main oil export terminal located deep within the Persian Gulf with a facility on the coast of the Gulf of Oman.
48 IRAN Country Report November 2018 www.intellinews.com