General Electric plotting Iran oil strategy
Indications are appearing that show the first American oil enterprise may soon set a foothold in Iran after a multiple-decade absence by US companies from the country’s oil industry.
General Electric has announced that it is plotting a strategy for its oil and gas business in Iran but emphasized that it will only proceed if the rules of the administration of President Barack Obama allow it to do business there.
‘‘Iran is a big market from an oil and gas perspective,’’ Lorenzo Simonelli, head of GE’s crude division, the London-based GE Oil & Gas, has been quoted by the US media as saying. ‘‘We will abide by the sanctions, but it’s a market where we used to transact.’’
Geographic expansion is part of a broad growth strategy for London-based GE Oil & Gas that may include acquisitions and more-advanced product offerings, reported the Boston Globe. Building out a division to look into Iran’s oil potentials is central to chief executive officer Jeffrey Immelt’s transformation of GE into a more streamlined industrial manufacturer, the report added.
The current US sanctions bar American companies from making investments in Iran. However, the companies can approach the Iranian market through their foreign subsidiaries, but they require a separation of those projects from US employees and offices, the report added.
GE announced in February that it is in talks with Iran to take up projects in the country’s oil industry.
A company spokeswoman said GE is exploring potential business opportunities in Iran, adding that the head of its oil and gas division – Simonelli – had visited the country recently.
“In line with the easing of sanctions, we have begun looking at potential business opportunities in Iran, while fully complying with the rules laid out by the US government. Simonelli’s visit is part of this effort,” the spokeswoman said.