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Shell owes Iran $2.3 billion

March 21, 2013 at 8:17 AM

THE HAGUE, Netherlands, March 21 (UPI) -- The estimated $2.3 billion payable to the National Iranian Oil Co. can't be settled because of sanctions imposed on Iran, Royal Dutch Shell said.

Shell published its annual Form 20-F for 2012, which provides a comprehensive detail of financial activity for the year ending Dec. 31, 2012.

The company said it ended upstream commercial operations and new business developments in Iran in 2010 as a result of sanctions. Western governments have used economic sanctions as a way to limit Iran's nuclear program, which the Iranian government says is peaceful.

"We recently began the process to close our small representative office in Iran and terminate all its activities," Shell's filing stated.

Shell through pre-existing contracts maintained oil ties to Iran before the European Union placed an embargo on Iranian crude oil mid-2012. It posted a net loss of $6 million in 2012 on Iranian oil purchases and says it still owes the Iranian government money.

"Currently, we have approximately $2.3 billion payable to, and $11 million receivable from, National Iranian Oil Company," the statement read. "We are unable to settle the payable position as a result of applicable sanctions."

All contracts and activity with Iran ended before June 28, the company said. Iran this week said it was weaning itself off oil revenue.

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