Petrol Stop

'ONGC, IOC doing biz with Iran'

Saturday, 15 May 2010

14 May 2010;timesofindia.indiatimes.com:NEW DELHI: Indian oil firms, including flagship explorer ONGC and refiner-marketer IndianOil Corporation, are playing it cool over a recent US Government Accountability Office report that named them among 41 companies worldwide who may attract sanctions for investing in Iran's energy sector and seeing it as one more instance of Washington's effort to arm-twist companies away from Tehran. "The publication of the report does not mean an action by the US administration. It does not add to the provisions in the US laws that are already in place to keep companies away from Iran or Sudan. Besides, Indian firms have not crossed individual investment cap and are doing business in line with Government of India's policy," a top ONGC executive told TOI, requesting anonymity. The report earlier this week listed ONGC Videsh, the overseas investment arm of ONGC, Oil India Ltd, IOC and Petronet LNG — a privately registered firm promoted by state-run companies for importing gas in ships — among the companies that have energy ties with Iran. It also names Hinduja group but lists it as a UK firm. This is not the first time Indian oil firms are facing US pressure over their Iran investments. TOI had on December 15, 2007, first reported the prospect of some US investors pulling out in the wake of the Sudan Divestment Bill moved by the US Congress. As reported on January 6, New York-based fund house TIAA-CREF pulled out its investments in ONGC and a clutch of Chinese firms for investments in Sudan oilfields. In the latest instance, except Petronet, all the other Indian firms have made it to the list for their past deals and recent discussions for developing oil and gas fields in Iran. Petronet and Hinduja group have been named because of their recent MoU, as partners of ONGC, OIL and IndianOIl, for developing facilities for exporting gas in ships. Earlier, ONGC Videsh, IndianOil and Oil India discovered oil and gas in Farsi block and proposed investing $5.5 billion in the acreage. "These are long-term projects and none of the firms have invested more than $20 million each in a year. In all, the Indian firms together may not have invested more than $100 million over 3-4 years. "If at all, other oil company executives said, the listed firms will now be more careful to keep on the right side of the provisions of sanction laws but will not stop doing business with Iran," one IndianOil executive said.