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Iran sets deadline for Shell, Repsol

26 April 2010 14:00

Iran has given Royal Dutch Shell and Repsol an ultimatum to decide on their involvement in the country’s giant South Pars gas field, a top Iranian oil official says.

Shell, Europe’s largest oil and gas company, teamed up with Spain’s Repsol and signed a deal with the National Iranian Oil Company in January 2002 to invest in South Pars’ phase 13.

Ever since the deal was signed, Shell has been delaying decisions on multi-billion dollar investments in phase 13 plans, reportedly due to political pressures from the White House.

However, Iran set a deadline for Shell and Repsol in April 2009, giving them until the following month to clarify their involvement in the project.

“We will not delay the development of South Pars phases waiting for foreign companies,” Ali Vakili, the managing director of the Pars Oil and Gas Company (POGC), said on Monday, adding that a one-week deadline has been set for the companies.

In June, Iran said the two firms had offered a new proposal for initial production at South Pars phases 13 and 14, which aim to produce and export liquefied natural gas (LNG) — gas cooled to liquid under pressure for transportation in special tankers.

Vakili also said a deadline for Turkey to clarify its involvement in developing three phases of South Pars had passed.

Turkish Energy Minister Taner Yildiz said in late March that Ankara would make a final decision about investment in the Iranian giant South Pars gas field within two weeks.

Iran possesses the world’s second-largest gas reserves after Russia, but has been slow in developing its energy sector due to US pressure on foreign firms to withdraw their investment.

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