TEHRAN, May 4 (UPI) -- Austrian energy company OMV said Wednesday it made the first steps toward resuming operations in Iran after signing an agreement with a national oil entity.
OMV signed a memorandum of understanding in Tehran with the National Iranian Oil Co. to asses the field potential at several developments in western Iran. The arrangement also includes consideration for crude oil and petroleum product trades.
"This memorandum of understanding is an important first step in resuming OMV's activities in Iran and in the long-term cooperation with the National Iranian Oil Co.," OMV CEO Rainer Seele said in a statement.
The Austrian energy company emerged in Iran in 2001 as the operator of the Mehr exploration basin in the west of the country and followed that with the discovery of reserves in 2005. The company has since scaled back its presence because of the pressure from international sanctions, though it never closed its offices in the Iranian capital.
Seele last year accompanied other European delegates for a trade visit to Tehran. OMV at the time said the dialogue with Iran was open, but there were no concrete developments unveiled last year. In February, the company said it was placing bets on opportunities in Iran as it retools its upstream portfolio for growth in the weakened energy sector.
Sanctions, easing as a result of a July nuclear agreement with world powers, starved Iran's energy sector of much-needed investments. The U.S. Treasury Department estimated Iran was out about $40 billion in revenue as a result of sanctions.
The International Monetary Fund estimates Iran's economy is now expected to grow by about 4 percent this year, which would rival some of its regional peers. The lifting of sanctions and higher oil production were some of the factors influencing the IMF's forecast.
OMV said last year Iran needs to set up an economic arena that attracts more foreign direct investments and move to adopt state-of-the-art technologies to revive its energy sector more completely.
A 2015 report from analysis firm Verisk Maplecroft said that even if energy sanctions ease, some companies may still face difficulties as military entities tied to the conservative Islamic Revolutionary Guard Corps will remain blacklisted, adding a layer of complexity for companies looking to move into the Iranian market.