by Javier Blas 24 June 2015

Royal Dutch Shell Plc executives have visited Tehran to discuss possible partnerships, the latest sign that the largest oil companies are serious about returning to Iran once a deal on the country’s nuclear program is done.

The meeting with Iranian officials covered its outstanding debt to National Iranian Oil Co. and possible areas of business cooperation, the company said in an e-mailed statement Wednesday. Shell owed $2.16 billion as of the end of 2014 for oil it wasn’t able to pay Iran for because of sanctions, according to its annual report.

Shell has previously indicated its desire to re-enter Iran, holder of the world’s fourth-largest oil reserves. Chief Executive Officer Ben van Beurden and his counterparts at France’s Total SA and Italy’s Eni SpA met Iranian oil minister Bijan Zanganeh in Vienna earlier this month. The fact talks have also taken place in Tehran shows a deepening engagement by The Hague-based company.

Brent crude prices at $63.50 a barrel on Thursday have fallen about 3 percent this month, partly on speculation of more supplies.

Better Terms

Seeking billions of dollars to revitalize its ailing oil industry, Iran plans to offer significantly better commercial terms to companies prepared to invest than offered during the last market opening almost two decades ago. Iran sees the return of foreign firms as a key goal from a potential nuclear deal that would remove sanctions. Talks on a final deal are scheduled to conclude at the end of this month.

The Shell executives are the second from a major Western oil company to acknowledge a trip to Tehran this year. In May Claudio Descalzi, CEO of Italy’s Eni SpA, revealed he had recently visited Iran and held meetings with senior officials.

The Rome-based company invested in Iran between 1999 and 2001 well before the last round of sanctions were imposed.

Iranian news agency Mehr earlier this month reported Shell officials visited Tehran to discuss petrochemical projects.

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RELATED

Shell holds talks in Iran on post-sanctions business

* Shell in Tehran to discuss debt, cooperation

* Shell CEO recently met Iran officials in Vienna

By Ron Bousso

LONDON, June 24 (Reuters) – Royal Dutch Shell has recently held talks in Iran to discuss business cooperation with the oil and gas-rich country should international sanctions on Tehran be lifted.

Officials from the Anglo-Dutch company major recently met Iranian officials in Tehran, a Shell spokesman said.

The two sides discussed Shell’s outstanding debt to National Iranian Oil Company (NIOC) for crude lifted but not paid for, and potential areas of business cooperation should sanctions be lifted, the spokesman said.

Shell Chief Executive Officer Ben van Beurden discussed the debt issue earlier this month on the sidelines of an OPEC meeting in Vienna, the spokesman said.

Major powers, Britain, France, Germany, China, Russia and the United States, are hoping to reach a deal with Iran over its nuclear programme by June 30 that could lead to the easing of sanctions on Iran’s oil industry.

Shell has around $2 billion in outstanding debt to the Islamic Republic as a result of Iranian oil deliveries which Shell had been unable to pay due to sanctions.

Western sanctions have cut Iran’s oil exports by more than half to around 1.1 million bpd from a pre-2012 level of 2.5 million bpd, with the loss of oil income making it difficult to invest in new development and pay for the equipment and services needed to keep its production operating smoothly.

(Reporting by Ron Bousso. Editing by Jane Merriman)

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