TEHRAN, July 2 (Mehr News Agency) -- Iranian Oil Minister Bijan Namdar Zanganeh said earlier this month that a $2 billion deal for developing the Azadegan oil field could be signed with a Japanese consortium by early July. A Japanese consortium is still in talks with Iran over the deal, but the United States is pressuring Japan to back out.

In a report quoting a U.S. official and sources close to the negotiations, the Financial Times said on Saturday that the United States was asking the Japanese government to pull out of the deal, seeking to raise pressure on Tehran.

 

Japan said on Wednesday it would weigh the U.S. pressures and its own energy needs when deciding on a deal to develop the giant Iranian oilfield. The pressure has put resource-poor Japan in a bind as it seeks to balance its long-term oil needs with its security alliance with Washington.

    

The government in Japan has been a staunch ally of U.S. President George W. Bush, throwing its support behind the U.S.-led war in Iraq despite opposition from the vast majority of the Japanese public.

 

It is clear that Tokyo has never been comfortable with the restrictions imposed on Iran by the Bush administration, but the United States wants Tokyo to back away from the deal to develop Azadegan oil field, one of the world's biggest untapped oil fields. The portion of the oil field that could be developed by Japan is expected to yield 300,000 bpd as the Azadegan oil field is the largest field in the Middle East. 

 

The United States has placed sanctions against Iran. The sanctions are in accordance with the so-called American D'Amato Law. The law prevents American or foreign firms from investing in Iran. According to the law, businesses and economic cooperation with Iran in excess of 40 million dollars are liable to the U.S. sanctions and punishments.

 

The American oil company CONECO was to cooperate with Iran in Iranian South Pars Oil Field in 1996. The company was denied of the lucrative deal due to the same law. As a result the concession was given to the French company Total. The French move was dubbed as ignoring the D'Amato Law.

 

Iran is Japan's third-biggest oil supplier and Japanese participation in developing the Azadegan oil field would make a major contribution to Japan's stable oil supply in the long term. But as the Iranian officials have mentioned, the Japanese consortium no longer enjoys exclusive rights to the deal. "The field of competition is open," the Iranian Foreign Minister Kamal Kharrazi has told reporters.  

 

In fact the U.S. ban on Iran and its trade partners is like the Damocles' Sword; one side of which is aiming at the American firms and the other is towards other countries' free economic cooperation. Such a policy is definitely doomed to fail in the end.

 

RA/ST

END

 

MNA

News Code 472

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