GAO: Only 6 confirmed market players in Iran's energy sector

U.S. review of open-source material finds only six companies working in Iranian energy sector last year.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   Jan. 14, 2016 at 9:19 AM
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WASHINGTON, Jan. 14 (UPI) -- Ahead of the so-called Implementation Day, a U.S. federal report found only six foreign companies were working in the Iranian energy sector last year.

White House spokesman Josh Earnest told reporters en route Wednesday to Nebraska the actual implementation date of the joint nuclear agreement reached last year is up to the Iranians.

"The Iranians will not benefit from sanctions relief unless and until they have fulfilled every single commitment that they made in the context of the joint agreement," he said. "And we are going to require that they provide sufficient access to international inspectors so that those steps can be independently verified prior to any sanctions relief being offered to the Iranians."

The U.S. State Department and Iran have said the Islamic republic is close to satisfying the terms necessary to ease sanctions pressure as Tehran shuts down some of its nuclear research activity. A reactor core at the Arak reactor in Iran is ready for concrete filling, Behrouz Kamalvandi, the spokesman for the Atomic Energy Organization of Iran, was quoted by Iran's Press TV as saying Thursday

"We carried out the last stage of the removal of the Arak reactor's heart and today our job was completely done," he said.

Iran is expecting widespread sanctions relief that could open its oil and gas sector up to international investors. A federal report from the U.S. Government Accountability Office found just six companies -- two from China and four from India -- were working in the Iranian energy sector last year. For five others, including the state-run oil company in Venezuela, the GAO was unable to confirm if activities were halted or continued for the 12-month period ending Dec. 1.

"None of the six firms that we identified as reported to have engaged in commercial activity in Iran's energy sector ... had U.S. government contracts," the report found.

No U.S. energy companies were reported to have been operating in Iran during the reporting period. Chevron last year confirmed it was acting in "full compliance" with U.S. law by staying out of Iranian business affairs.

Total production from Iran is holding steady at around 2.85 million barrels per day from the 2013 average of 2.67 million bpd. Most major producers are expecting a decline in oil production because of lower crude oil prices. Mehdi Assali, the director of affairs Organization of Petroleum Exporting Country affairs at the Iranian Oil Ministry, said that, with production costs of around $10 per barrel, Iran stands in a unique position once sanctions pressure ease.

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