Shell Signs Iran Oil & Gas Development Deals
$RDS.A, $RDS.B, $TOT
Analysts said the deals showed major Crude Oil companies are prepared to keep doing business with Iran
Royal Dutch Shell (NYSE:RDS.A, RDS.B) signed a provisional agreement Wednesday to develop Iranian Oil & Gas fields, an Iranian official said, the 1st deal by the world’s 2nd biggest listed Oil firm in Iran since sanctions were lifted.
The Anglo-Dutch company confirmed it had signed a memorandum of understanding with National Iranian Oil Company (NIOC) on Wednesday “to further explore areas of potential cooperation”, declining to give further details.
Analysts said the agreement underscored major Oil companies’ willingness to keep doing business with Iran despite the risk that US President-elect Donald Trump could scrap the nuclear deal that ended the sanctions earlier this year.
Earlier on Wednesday, an Iranian Oil Ministry official said Shell would sign 3 MOUs in Tehran to develop the South Azadegan, Yadavaran Oil fields and the Kish Gas field.
A Shell spokesman said after the signing that, “details of specific opportunities are Confidential”.
France’s Total (NYSE:TOT) which last month signed the 1st deal by a Western energy firm since sanctions were lifted, will start talks about new Oil & Gas projects but will not be signing any deals on Wednesday, the Iranian official said.
Total declined to comment.
“These preliminary agreements could mark a strong sign of confidence towards the sustainability of the nuclear deal,” said a research analyst at Wood Mackenzie.
“These preliminary agreements come at the right time for President Rouhani, who can leverage on the nuclear deal bearing fruits for Iran’s economy despite Trump’s election,” he said.
Iran, the 3rd largest producer in the OPEC (Organization of the Petroleum Exporting Countries), hopes its new Iran Petroleum Contracts (IPC) will attract foreign companies and boost production after years of under investment.
Foreign firms keen to tap Iran’s vast Oil & Gas reserves have so far made little inroads into the country despite the lifting of many sanctions and the new contracts that aim to improve the terms Iran offers for oil development deals.
Iran will launch its 1st new-style tender to develop Oil & Gas fields since the lifting of sanctions in Q-1 of Y 2017.
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