Global Business in Iran Update, February 18-March 2, 2010

Russian Gazprom and Iran near major oil deal; Caterpillar forbids sales in Iran; Malaysian firm to develop Resalat oil field; Iran seeks more Azerbaijani gas; Russia promises to honor S-300 sales; Indian NALCO's stalled projects.

 

NEW BUSINESS PROJECTS IN IRAN

 

ARMENIA

(Global Business in Iran country page)

(February 24, 2010) Iran and Armenia agreed to construct the 217-mile Shahnazi-Zadeh oil pipeline from Tabriz to Mughri. The pipeline will have a capacity of 70,000 bbpd. The project is expected to cost $350 million. Armenia and Iran recently completed a 2.3 billion cubic meter capacity gas pipeline. See Global Business in Iran for details.

 

MALAYSIA

(Global Business in Iran country page, background on foreign relations with Iran)

(February 22, 2010) Iran has signed an agreement with an unnamed Malaysian firm to develop the Resalat oil field. Development will last forty-two months and increase production by 10,000 bbpd to 47,000 bbpd. The deal is worth an estimated $1 billion. Previous reports indicated that the Malaysian company would work in conjunction with Chinese energy firms. See Global Business in Iran for details.

 

OMAN

(Global Business in Iran country page, background on foreign relations with Iran)

(March 1, 2010) Oman’s Public Authority for Electricity and Water awarded Iran’s SUNIR Group a $75 million contract to construct a water pipeline in the al Jabal al Akhdar resort. The SUNIR Group is active in water, electricity, gas, and oil sectors. See Global Business in Iran for details.

 

RUSSIA

(Global Business in Iran country page, background on foreign relations with Iran)

(March 1, 2010) Iran has held talks with Russia’s Gazprom on development of the Azar oil field. Iran says that a development deal will be signed this month. Gazprom did not immediately comment on the announcement. In December, Gazprom signed a memorandum of understanding to study the development of Azar and Shangule oil fields. See Global Business in Iran for details.

 

TURKEY

(Global Business in Iran country page, background on foreign relations with Iran)

(February 22, 2010) Iran and Turkey have signed a new customs agreement, creating trade windows at Bazergan, Khoy, Saro, and Maku. Iran and Turkey hope to boost trade to $30 billion over the next few years. Trade between the countries reportedly stands at $11 billion. See Global Business in Iran for details.

 
 
 
 

UPDATES TO EXISTING BUSINESS PROJECTS

 
 

AZERBAIJAN

(Global Business in Iran country page, background on foreign relations with Iran)

(February 22, 2010) Iran’s ambassador to Baku, Mohammad Baqer Bahrami, said that Iran is interested in purchasing 350 billion cubic feet (9.9 billion cubic meters) of natural gas per year. Inadequate infrastructure makes it difficult for domestic gas to reach Iran’s northern provinces. Iran and Azerbaijan are close to signing a long-term, 2 billion cubic meter gas import deal. See Global Business in Iran for details.

 

FRANCE

(Global Business in Iran country page, background on foreign relations with Iran)

(February 21, 2010) Iran-Khodro has begun local production of the Peugeot 207i. Iran-Khodro plans to produce 20,000 cars next year. Local firms manufacture 50-60 percent of the parts for the 207i. Iran-Khodro will begin domestic sales of the Peugeot 207i on March 21, 2010, in time for the Persian New Year. See Global Business in Iran for details.

 

GERMANY

(Global Business in Iran country page, background on foreign relations with Iran)

(March 1, 2010) Munich Re, Germany’s largest insurance company, conducted $13.6 million of business in Iran before deciding last month to cut financial ties. See Global Business in Iran for details.

 

INDIA

(Global Business in Iran country page, background on foreign relations with Iran)

(February 25, 2010) India’s National Aluminum Company Ltd. (NALCO) said that plans to construct a power plant and a 310,000 ton aluminum smelter were stalled because of political problems. NALCO plans to invest some $2 billion in the projects. See Global Business in Iran for details. 

 

RUSSIA

(Global Business in Iran country pagebackground on foreign relations with Iran)

(February 19, 2010) Russia’s Deputy Foreign Minister, Sergei Ryabkov, said that Russia would honor its agreement to sell five batteries of the S-300 anti-air missile system to Iran. On 27 February, Russian Foreign Minister Sergei Lavrov issued a similar statement, stating that Russia would fulfill its contract although some issues still needed to be resolved. After a February 16 visit by Israeli Prime Minister Benjamin Netanyahu to Moscow, senior Russian officials had stated that the S-300 would be delayed. See Global Business in Iran for details.  

 

UNITED STATES

(Global Business in Iran country page)

(February 26, 2010) The California Public Employees’ Retirement System (CalPERS), a $200 billion pension fund, has nearly $900 million invested in 23 companies that have energy or defense related links in Iran. On Wednesday, state lawmakers held hearings on CalPERS' ties to Iran. The fund has said that divestment could cost $20 million in transactions costs, and $127 million after reinvestment. See Global Business in Iran for details.

(February 27, 2010) Caterpillar, the construction equipment manufacturer, said it would no longer allow its affiliates and subsidiaries to do business with Iran. The move came after a group called United Against a Nuclear Iran (UANI) ran a billboard in Caterpillar’s hometown of Peoria calling for the company to cease business in Iran. An Iranian company, Arya Machinery, marketed Caterpillar equipment in Iran as recently as late last year. See Global Business in Iran for details.