British energy company BP owns the Rhum field with the Iranian Oil Co. The field was closed in 2010 because of sanctions placed on Iran's energy sector.
The British government, in a statement Tuesday, announced it took the necessary steps to allow BP to resume production.
"[Iranian Oil Co.] will receive its share of the revenues from gas sales at Rhum," the government said. "As [the company] is currently designated under European Union-Iran sanctions, these will be placed in a frozen account."
Western sanctions on Iran are designed to deprive its government of energy revenue it could use to support a controversial nuclear program.
BP said the field has 800 billion cubic feet of recoverable natural gas reserves. It has a peak production capacity of 300 million cubic feet per day and an expected lifespan of 16 years.
The British government said it would co-manage the field through 2018 or until "circumstances change." The Rhum field accounts for approximately 4 percent of Britain's annual gas production.
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