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Persian Journal (Iran): Oil firms willing to bend-over for mullahs of Iran

Oil firms willing to bend-over for mullahs of Iran

As the clock ticks toward possible economic sanctions on Iran, foreign oil companies keen to gain a foothold in the country's massive hydrocarbon industry are as eager as ever to do business with the Islamic republic of mullahs.

Attracting foreign investment into the Iranian oil and gas industry appears to be a priority for both the country's firebrand president and his powerful oil minister. The close ties between Iran and global energy companies suggests U.S. efforts to use sanctions as a way to stop development of the country's nuclear program may not prove successful. “One has to realize that with Iran, when you look at both the oil and gas reserves, they have a very strong position as a country,” said Jeroen van der Veer, chief executive of Royal Dutch Shell Plc, which has a long history of involvement in Iran.
For Iran, as well as for large energy companies and big consumers such as China and Japan, the stakes are high. Iran straddles 12% of global oil reserves and holds the world's second-largest gas reserves after Russia, but the country needs an estimated $50 billion of foreign investment over the next 10 years to reach future energy production targets. For Iran to maintain its number two slot in the Organization of Petroleum Exporting Countries, it needs to tap into its oil reserves and quickly.

Likewise, energy-hungry consuming nations such as China, India and Pakistan are continuing their negotiations with Iran with an eye on its abundant resources, also potentially watering down U.S. efforts to isolate the country.

Iran is facing a Friday deadline from the U.N. to halt uranium enrichment due to suspicions it is trying to develop nuclear weapons. The government of President Mahmoud Ahmadinejad insists the Non-Proliferation Treaty gives Iran the right to enrich uranium for fueling civilian nuclear power plants, and he has given no ground in the international faceoff.


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