EU: US Ending Nuclear Waivers Means Harder to Check Iran

The European Union's foreign policy chief on Thursday condemned Washington's move to end sanction waivers for countries remaining in the Iran nuclear accord, warning it would make it harder to keep Tehran in check.

Donald Trump's administration announced Wednesday that it was ending the waivers because of a series of "escalatory actions" by Iran aimed at pressuring the United States, which pulled out of the accord in 2018.

But the EU's Josep Borrell highlighted the "enduring importance" of the deal, known as the Joint Comprehensive Plan of Action (JCPOA), because it was vital to ensuring that Iran's nuclear activities remain above board.

"The agreement remains the best and only way to ensure the peaceful nature of the Iranian nuclear program" Borrell told a United Nations Security Council meeting on Europe-UN relations.

"This is why I regret yesterday's decision by the US not to prolong the waivers for the JCPOA-related nuclear projects.

"This will make it more difficult for the international community to ensure the exclusively peaceful nature of Iran's nuclear program."

Iran has taken small steps away from its nuclear commitments in a bid to get Washington to remove sanctions as called for by the 2015 accord.

Trump quit the agreement negotiated under his predecessor Barack Obama, under which Iran had drastically curbed its nuclear activities.

But the Trump administration until now had issued waivers to allow companies, primarily from Russia, to keep carrying out the work of the agreement without risking legal ramifications in the world's largest economy.

Iran's UN ambassador said that with the end of waivers, US Secretary of State Mike Pompeo was pulling the "final plug" on the nuclear deal two years after Trump withdrew the US from it.

“Claiming US is STILL 'Participant' is not just preposterous; it's FALSE," the envoy Majid Takht Ravanchi tweeted.

The envoy was referring to Washington's claim that it remains a participant in the deal, despite renouncing it, and can push to extend an arms embargo on Iran due to begin expiring in October.

Photo: Wikicommons

US Grants Iraq Brief 30-Day Waiver for Iranian Gas Imports

Washington on Sunday granted Iraq a 30-day extension to a waiver allowing it to import Iranian gas for its dilapidated power grids despite American sanctions, an Iraqi official said. 

The extension comes as Baghdad faces a cocktail of crises, including collapsing oil prices and the novel coronavirus pandemic and political deadlock over government formation.

Iraq relies on gas and electricity imports from its neighbor Tehran to supply about a third of its power grid, crippled by years of conflict and poor maintenance.

The US blacklisted the Iranian energy sector in late 2018 and has granted Baghdad a series of waivers, usually for 45, 90 or 120 days.

Last month, Washington granted Iraq a 30-day extension—its shortest yet—and extended it again on Sunday.

"It is extended for another 30 days. There are no specific conditions," the Iraqi official told AFP. 

Iraqi officials had expected the waiver would be extended long enough to allow new prime minister designate Mustafa Kadhimi to pull together a government. 

The PM-designate is in talks with Iraq's political parties to form his first cabinet, and has until May 9 to submit it to parliament for a vote of confidence. 

Kadhimi had a strong showing of support from across Iraq's political spectrum when he was nominated, but disputes over ministerial positions appear to have worn it down. 

The US has pressured Iraq to use the waivers to become independent from Iranian energy, but progress has been slow.

OPEC's second-biggest producer relies on crude exports to fund more than 90 percent of its state budget, but the crash to prices under $30 per barrel has seriously undermined the government's fiscal position. 

In a further blow, coronavirus has spread across the country, with more than 1,800 confirmed cases and 87 deaths announced by the health ministry. 

Photo: Iraq PM

Iraq Sets Up 'Loophole' in US Sanctions to Buy Iranian Power

By Maya Gebeily

Iraq is establishing a financial "loophole" to continue buying vital gas and electricity from Iran despite US sanctions, AFP has learned, mirroring a European mechanism that came into effect Friday.

The "special purpose vehicle" (SPV) would allow Iraq to pay for imported Iranian energy in Iraqi dinars, which Iran could use to exclusively buy humanitarian goods, three senior Iraqi officials said.

The workaround would allow Baghdad to keep the lights on and avoid shortage-driven protests without triggering US sanctions, as it treads an increasingly precarious tightrope between its two main allies Tehran and Washington.

One senior government official told AFP it was the product of months of talks between Iraqi, Iranian and US officials.

"The Iraqi government will continue to pay Iran for gas by depositing money into a special bank account inside Iraq, in Iraqi dinars," the official said.

"Iran will not be able to withdraw the money, but will be able to use it to purchase goods from outside Iraq."

Iraq has an outstanding bill of around $2 billion for previous gas and electricity purchases, according to Iranian Oil Minister Bijan Zangeneh.

A US official told AFP that Washington was aware of the mechanism's creation.

The US embassy in Baghdad declined to comment, while Iran's embassy did not respond to an AFP request.

Two additional high-level Iraqi officials confirmed Baghdad was establishing such an account with US knowledge, but could not say whether payments into the account had begun.

"How else is Iraq supposed to pay what it owes Iran? We have no other choice," the second official said.

‘Iran's ATM'

To offset its notorious power shortages, Iraq imports around 1,400 MW of electricity and 28 million cubic meters (988 million cubic feet) of gas for power stations from neighboring Iran, which together make up about a third of Iraq's power supply.

That reliance has angered the US, which slapped tough sanctions on Iran last year but has granted Iraq several temporary waivers to keep purchasing Iranian power until October.

The US insists Iraq wean itself off Iranian energy, but Baghdad has said that could take up to four years, during which it would need to keep purchasing at least Iranian gas.

To do so, the central banks of Iran and Iraq agreed in February to create a payment method that steers clear of US sanctions, Iran's state news agency IRNA said, without providing additional details.

That would mean not dealing in US dollars and purchasing only "humanitarian goods" allowed by the US -- like food and medicine.

"We would become Iran's ATM," another Iraqi official told AFP.

According to two of the senior Iraqi officials, Baghdad's SPV would likely be set up at the Trade Bank of Iraq.

The TBI has handled most of the Iraqi government's international transactions since its establishment in the aftermath of the US-led invasion in 2003.

A senior TBI source told AFP the bank had been involved in the negotiations but the account had not yet been created.

"The US Treasury has confidence in the TBI's processes. We are in discussions to reach an agreement, which would be fully within US exemptions," the source said.

'Like a Ledger'

It would effectively be a "loophole" around sanctions, said Ahmed Tabaqchali, senior fellow at the Sulaymaniyah-based Institute of Regional and International Studies.

"It's like a ledger. You record the money paid, and Iran has that much credit in Iraq," Tabaqchali told AFP.

The system would work much like INSTEX, a mechanism recently activated by Britain, Germany and France to trade legitimately with Iran without falling foul of US sanctions.

Still, the system is fraught with political, financial and practical complexities

Iraq's economy relies almost exclusively on oil revenues, paid in dollars, which leaves Baghdad extremely vulnerable to any punitive measures the US could take in response to a violation.

It also remains unclear what exactly Iran could purchase from Iraq as trade is heavily tilted in the other direction.

"Credit would develop in Iran's favour but how would it actually cash it?" said Tabaqchali.

Importing goods from outside Iraq would require a third party willing to take the political and financial risk of such a transaction, he told AFP.

And, ultimately, much of Iraq's transactions with Iran are cash purchases of commercial goods—something US authorities implementing sanctions are unable to monitor.

"Cash is untraceable," said Tabaqchali.

Photo: Wikicommons

US Grants Energy-Hungry Iraq New Iran Sanctions Waiver

The United States has granted Iraq another 90-day waiver to continue with vital energy imports from neighboring Iran despite re-imposed sanctions, a government source said Saturday.

The extension came after "long discussions" with Washington ahead of a looming deadline on a previous extension granted in December, the official, close to the negotiations, told AFP on condition of anonymity.

The talks came amid spiking tensions between Iraq's two closest allies—the US and Iran—following a twin attack on tankers in the Gulf that US President Donald Trump has blamed on Tehran.

Iranian energy imports are vital to Iraq, one of the world's hottest countries, which faces chronic blackouts that often leave homes without power for up to 20 hours a day.

Summer temperatures in Baghdad are already topping seasonal averages, boosting electricity consumption and raising fears of a repeat of last summer's mass protests over power outages.

To compensate, Iraq pipes in up to 28 million cubic meters of Iranian gas a day for power generation and also directly imports up to 1,300 megawatts of Iranian electricity.

That dependence is uncomfortable for Washington, which sees Tehran as its top regional foe. 

Trump reimposed crippling unilateral sanctions on Iran's energy and finance sectors in November following a decision to abandon a landmark 2015 nuclear deal between major powers and Tehran.

He gave Iraq an initial 45-day waiver to continue buying electricity and natural gas from Tehran, and in December Washington granted Baghdad an 90-day extension.

Photo: IRNA

Trump Playing Hardball Gives Iran Oil Buyers Costly Headache

The biggest buyers of Iranian oil are being struck by deja vu, and it’s not conjuring up pleasant memories.

Six months ago they were scrambling to secure alternative supplies as the U.S. prepared to impose sanctions on Iranian oil exports, though last minute waivers eventually gave them a reprieve. Now, the Donald Trump administration says it won’t renew those same waivers, forcing the buyers to find a replacement for the Persian Gulf barrels.

Asia is more dependent on oil imports than any other region and has been repeatedly buffeted by America’s campaign to isolate Iran, once OPEC’s second-largest producer. While they’ll be able to find other supplies, they face the prospect of having to pay more, potentially accelerating inflation and putting pressure on their economies.

Importers had been expecting the waivers to be extended, perhaps with a cut in permitted volumes instead of an outright ban, according to refinery officials in Asia. They’d put purchases for May on hold as they awaited the U.S. decision.

One buyer, South Korea’s Hanwha Total Petrochemical Co., said it’s possible to find alternatives, but they’ll cost more and potentially affect the firm’s profits because they largely depend on the price of raw materials. The company has been importing and testing other supply from areas such as Africa and Australia, a spokesman said.

The White House said on Monday that its decision is intended to bring Iran’s oil exports to zero and squeeze the Persian Gulf state’s principal source of revenue. The U.S. wants to force Iran back to negotiations over its nuclear program. Any buyer importing crude after the waivers expire on May 2 faces the risk of being cut off from the American financial system.

Elusive Alternatives

While Trump said in a tweet that Saudi Arabia and other producers in the Organization of Petroleum Exporting Countries will make up for any shortfall, that prospect will not necessarily bring relief to buyers. South Korea, for example, is highly dependent on a type of ultra-light oil known as condensate from Iran that’s used by the Asian nation’s petrochemical producers.

These companies will be hit especially hard by the U.S. decision to eliminate waivers, according to four condensate traders interviewed by Bloomberg. That’s because Saudi Arabia and the United Arab Emirates—among the biggest OPEC producers—export only limited supplies of the ultra-light oil, which is used in units known as splitters to produce petrochemicals and plastic components, they said.

Unipec, the trading arm of China’s state-owned refining giant Sinopec, hasn’t been approached by Saudi Arabia or the U.A.E. with more oil offers, said a person familiar with its procurement plan who asked not to be identified as the information is private. While the firm expected America to renew waivers at least with limited volumes, it had a contingency plan for an end to shipments, said the person, adding that it will seek to import more from the Middle East, West Africa and the U.S.

Caught by Surprise

An official at another major South Korean refiner also said it was caught off-guard by the U.S. decision, and still remained hopeful that the U.S. would ultimately extend waivers allowing at least some Iranian imports. Based on Bloomberg’s ship-tracking data, Asian buyers such as China, India, Japan and South Korea accounted for more than 80 percent of the Islamic Republic’s total crude and condensate exports in March.

Saudi Arabia, for its part, will coordinate with other crude producers to ensure that adequate supplies are available and the market “does not go out of balance,” Energy Minister Khalid Al-Falih said after the Trump administration announced the end of the waivers.

One person familiar with the U.S. decision announced Monday said that some of the countries that had previously received waivers would be given a little more time to wind down purchases. The person described that not as a waiver but more as a brief grace period.

Crude Gains

Global benchmark Brent crude rose to a six-month high, moving toward $75 a barrel in London after the U.S. decision. Front-month futures were at $74.33 a barrel at 11:43 a.m. in London. West Texas Intermediate, the American marker, also jumped and is trading near $66 a barrel in New York.

Some refiners in India—which had been negotiating hard with the U.S. for the waivers to be renewed—sought to play down the impact on Monday. Indian Oil Corp., the nation’s top importer of Iranian crude, has enough supplies of alternative feedstock, said a company official who asked not to be identified because of internal policy.

The company intends to use built-in options in its oil contracts with Kuwait, Abu Dhabi, Saudi Arabia and Mexico to procure more crude from those sources, thus making up for any shortfall from the Persian Gulf state, the official said. Fellow domestic refiner Hindustan Petroleum Corp. is confident there won’t be supply constraints, according to Chairman M.K. Surana.

HPCL has reduced its purchases from the Islamic Republic and has limited exposure to U.S. sanctions, he said in a phone interview, though he added that a halt in supplies from Iran would likely push oil prices higher in coming months.

Photo: Bloomberg

US Extends Iraq Waiver Over Iran Sanctions

The United States is extending a waiver to let energy-hungry Iraq keep buying power from Iran, despite Washington's campaign of sanctions aimed at curbing Tehran, an official said.

The State Department issued a second three-month exemption from Iran sanctions for Iraq, mindful not to destabilize the war-torn country increasingly reliant on Iranian gas and electricity to cope with chronic blackouts that have triggered unrest.

"While this waiver is intended to help Iraq mitigate energy shortages, we continue to discuss our Iran-related sanctions with our partners in Iraq," a State Department official said.

The official said that increasing Iraq's capacities and diversifying imports "will strengthen Iraq's economy and development as well as encourage a united, democratic and prosperous Iraq free from malign Iranian influence."

Despite Washington's repeated warnings, Iraq since the fall of Saddam Hussein has walked a fine line and maintained warm ties with Iran, with which Iraq's majority Shiite community shares religious affinities.

Iranian President Hassan Rouhani paid a visit last week to Iraq, where he highlighted Tehran's support in battling the Islamic State extremist movement and said that the United States was "despised" in the region.

Last year, US President Donald Trump pulled out of an international deal on curbing Iran's nuclear program that was negotiated by his predecessor Barack Obama.

Trump instead imposed sweeping sanctions on Iran as he seeks to reduce the regional role of the Shiite clerical state, a foe of US allies Saudi Arabia and Israel.

But the US approach has met strong opposition, with European powers encouraging their companies to stay present in Iran so as to safeguard the denuclearization accord.

Photo Credit: IRNA

US Grants Iraq 90-Day Extension to Iran Sanctions Waiver: Source

The United States has granted Iraq a 90-day extension to an exemption from reimposed sanctions on Iran to keep on importing energy, a government source said on Thursday.

President Donald Trump reimposed crippling unilateral sanctions on Iran's energy and finance sectors on November 5 following his May decision to abandon a landmark 2015 nuclear deal between major powers and Tehran.

But he gave Iraq a 45-day waiver to continue buying electricity and natural gas to generate it from its eastern neighbor. 

Iraq was expected to use that time to submit a plan on how it would wean itself off Iranian supplies.

In the days leading up to the deadline Thursday, Prime Minister Adel Abdel Mahdi said a delegation of Iraqi officials would travel to Washington to discuss sanctions. 

And on Thursday, a government source involved in the talks, told AFP the delegation had secured a 90-day extension so Iraq could keep buying both Iranian electricity and gas.

Asked whether the US had pressured the Iraqi delegation to partner with US companies to fill the eventual gap, the source said the issue was part of "complicated discussions.”

Iraq faces a chronic power shortage that often leave homes without mains electricity for as much 20 hours a day and was a key driving factor behind mass protests this summer.

To cope with the shortages, Iraq pipes in up to 28 million cubic meters of Iranian gas a day for power generation and also directly imports up to 1,300 megawatts of Iranian electricity.

That dependence is uncomfortable for Washington, which sees Tehran as its top regional foe. 

Last week, US Energy Secretary Rick Perry discussed sanctions with Iraq's ministers of oil and electricity in Baghdad, and said Iraq should partner with US companies to become energy independent. 

"Working together, the US and Iraq can develop Iraq's oil, gas and water industries," Perry said.

Iraq's electricity ministry said it could stop relying on Iranian electricity within two years, but that halting gas imports would be much more difficult.

One solution would be developing Iraq's ability to capture gas flares, the gas set alight during oil extraction.

The World Bank estimates that wasted flares represent an annual loss of about USD 2.5 billion—enough to fill the gap in Iraq's gas-based power generation.

A second source with close knowledge of the negotiations told AFP Washington was trying to convince Iraq to partner with American firms General Electric, Baker Hughes and Orion to capture flares.

“The US tells Iraqi officials it's a win-win-win: they stop relying on Iran, they capture their own gas and they benefit US companies in the process," the source said. 

Neither Iraq's electricity ministry nor the US embassy in Baghdad responded to AFP requests for comment. 

Photo Credit: IRNA

Iraq Gets US Sanctions Break to Keep the Lights On

Iraq has won an exemption allowing it to buy Iranian electricity despite US sanctions, as the country plagued by chronic power shortages walks a tightrope between rivals Washington and Tehran.

With US measures imposed Monday taking aim at Iran's banking and energy industries, there were concerns Iraq—which heavily relies on its eastern neighbor for electricity and consumer goods—would be caught in the crossfire.

But Baghdad has managed to secure an exception.

"We granted Iraq a waiver to allow it to continue to pay for its electricity imports from Iran," Brian Hook, the State Department's representative on Iran, announced Wednesday.

Iraq would be expected to show the US how it would wean itself off Iranian gas, a well-informed source told AFP.

"The US gave us 45 days to give them a plan on how we will gradually stop using Iranian gas and oil," the source said.

"We told them it may take us up to four years to either become self-sufficient or find another alternative."

The exemption came after talks between Iraqi and US officials, including from the White House and Treasury, the source said.

Iraqi government representatives have shuffled between American and Iranian officials for months in a bid to insulate their fragile economy from escalating tensions.

This week, Prime Minister Adel Abdel-Mahdi said Baghdad was in talks with both sides to protect its interests.

“Iraq is not a part of the sanctions regime. It talks to everyone, and does not want to get involved in a conflict that it's not a part of," he told reporters Tuesday.

Baghdad has a strong relationship with the United States, coordinating on security, politics, and governance.

But its economy is profoundly intertwined with that of Iran.

Keeping the Lights On

Gutted by the international embargo of the 1990s and the US-led invasion of 2003, Iraq's industries produce little.

Instead, its markets are flooded with Iranian goods—from canned food and yoghurt to carpets and cars.

These non-hydrocarbon imports amounted to some USD 6 billion (five billion euros) in 2017, making Iran the second-largest source of imported goods in Iraq.

Perhaps most consequential for Iraq's 39 million people is their dependency on Iran for electricity.

Chronic cuts, which often leave homes powerless for up to 20 hours a day, were a key driving factor behind weeks of massive protests in Iraq this summer.

To cope with shortages, Baghdad pipes in natural gas from Tehran for its plants and also directly buys 1,300 MW of Iranian-generated electricity.

That reliance is uncomfortable for the US, whose quest to diminish Tehran's influence prompted it to reimpose sanctions on Iranian financial institutions, shipping lines, energy, and petroleum products on Monday.

Eight countries would be temporarily allowed to import Iranian crude oil.

Iraq's special exemption appears to have come with a condition that it lay out how it would stop using Iranian electricity, said Nussaibah Younes, a senior adviser for the European Institute of Peace.

"In order to get this exemption, the Iraqis had given some sort of roadmap idea," Younes told AFP.

One way would be capturing the gas set alight when Iraq extracts oil, which according to the World Bank represents an annual loss of about USD 2.5 billion—enough to fill the gap in Iraq's gas-based power generation.

Appeasing Iran

American firms may help fill the vacuum left by Iran.

In January, Iraq signed a memorandum of understanding with US energy company Orion on gas exploits at a southern oil field.

And in October, Iraq signed a memo with the US's General Electric to revamp the electricity sector, after signing a similar agreement with Germany's Siemens.

The source told AFP that GE was among several US companies proposed to Baghdad during negotiations with the US.

But Iraq has had to simultaneously reassure Iran, in part by granting it an outlet to circumvent US sanctions.

"The focus for the Iranians is informal sanctions-busting activity in Iraq, including accessing hard currency through Iraqi exchanges and through smuggling operations," said Younes.

Baghdad, she expected, would likely "turn a blind eye".

Iraq has simultaneously been granting Iranian officials more time for face-to-face meetings, including its ambassador in Baghdad, Araj Masjadi.

He met with new Finance Minister Fuad Hussein and Electricity Minister Luay al-Khateeb on Wednesday, pledging close cooperation on the power sector in the future.

For Masjadi, the meetings appeared to be a reminder of Tehran's entrenched role in Iraq.

"We need Iraq the way Iraq needs us," said Masjadi.

Photo Credit: MAPNA

US Issues Waivers to Allow Iran Deal to Continue

The United States said Monday it was issuing waivers to allow the continuation of a nuclear deal with Iran, after declaring the agreement a disaster and slapping sweeping sanctions.

Hours after sanctions went into effect that ban most trade with Iran, the State Department said it was exempting projects set up through the 2015 nuclear deal negotiated under former president Barack Obama.

The international activities at Bushehr, Iran's only nuclear power station, as well as the Fordow enrichment plant and the Arak heavy water reactor will be allowed "to continue under the strictest scrutiny to ensure transparency and maintain constraints on Iran," the State Department said in a statement.

"This oversight enhances our ability to constrain Iran's program and keep pressure on the regime while we pursue a new, stronger deal," it said.

The State Department said the waivers were "temporary," without specifying a timeframe, and "conditional on the cooperation of the various stakeholders."

The 2015 agreement promised that world powers would assist Iran in developing civilian nuclear energy—the clerical regime's stated goal for its atomic program.

Russia has supplied fuel for the Bushehr reactor. The Arak site, which could eventually be used to produce plutonium, is being redesigned under the deal to ensure it does not, with spent fuel to be shipped out.

Russia is also working with Iran on isotope production at Fordow to ensure that the site works toward medical purposes rather than uranium enrichment.

The other parties to the deal—Britain, China, France, Germany and Russia along with the European Union—say that the accord remains in force and is working, noting that UN inspectors report that Iran has complied.

President Donald Trump has called the agreement a "disaster" and, as of Monday, the United States will sanction countries and companies that do business with Iran or buy its oil.

Secretary of State Mike Pompeo said Monday the United States wants Iran to undertake a "180-degree" change that includes cutting off support for regional proxies such as Hezbollah and ending missile tests.

Photo Credit: Wikicommons

France's Total Has Officially Left Iran: Oil Minister

French energy giant Total has officially quit its multi-billion-dollar gas project in Iran, Oil Minister Bijan Namdar Zanganeh said on Monday, following the reimposition of US sanctions.

"Total has officially left the agreement for the development of phase 11 of South Pars (gas field)," he told parliament's news agency ICANA, adding that it had been more than two months since the French firm announced it would leave.

Zanganeh also appeared before parliament to underline the dire state of Iran's oil and gas facilities, which he said were "worn out" and in need of renovation that Iran could not afford. 

The United States said in May that it was abandoning the 2015 nuclear deal and reimposing sanctions on Iran in two phases in August and November, with the second targeting the country's vital oil and gas sector.

The other parties to the nuclear deal—Britain, France, Germany, China and Russia—have vowed to stay in the accord but their companies risk huge penalties if they keep doing business in Iran.

Total had already said it would be impossible to remain in Iran unless it received a specific waiver from Washington, which was not granted. 

The French firm signed up in July 2017 for the USD 4.8 billion project to develop the field off Iran's southern coast, as the lead partner alongside the China National Petroleum Corporation (CNPC) and Iran's Petropars. 

It was due to bring state-of-the-art technology to create the pressure needed to tap the gas field, which Iran could then replicate for surrounding fields where pressure has been declining.

Total was due to make an initial USD 1 billion investment, but the company said in May that it had spent less than 40 million euros on the project to date, as uncertainty over US actions mounted. 

The company would have been highly vulnerable to US penalties for remaining in Iran. 

It has USD 10 billion of capital employed in its US assets, and US banks are involved in 90 percent of its financing operations, Total said in May.

Technology Needed

Zanganeh said the process to find a replacement for Total was underway.

But it is unlikely that CNPC or Iran's own firms can take over the project, said Homayoun Falakshahi, an energy analyst for Wood Mackenzie in London.

"The technology Total was hoping to implement would have been world-first, using electricity to compress the gas," he told AFP.

"The other complication is that it needs huge platforms. Iran can build 5,000- to 7,000-tonne platforms. This would have been 20,000 tonnes," he added.

CNPC was suspended from the project once before, in 2011, for failing to make progress. 

The urgent need for investment to upgrade Iran's dilapidated energy infrastructure was a key motivator behind its decision to join the 2015 nuclear deal. 

Zanganeh appeared in parliament on Monday to answer questions on safety concerns following a number of recent fires at refineries. 

"A big part of the oil industry has been worn out and the necessary renovation has not taken place," he told parliament, according to the official IRNA news agency. 

He said there were 10 cases per day of tubes perforating in Iran's southern facilities, and that some refineries were up to 80 years old, "whereas the useful life of an industrial unit is 30 years". 

"We have no resources for renovating them," he added.

But some conservatives in Iran oppose foreign involvement in the strategic energy sector, and have frustrated plans to develop attractive investment contracts.

As a result, the Total deal was the only major investment project finalized after the nuclear deal came into force.

The only other deal was a smaller project with Russia's Zarubezhneft, worth EUR 600 million, to develop two oil fields in western Iran.

Photo Credit: IRNA

Iran Air Says Will Receive 5 New ATR Planes on Sunday

Iran Air said Saturday it was set to take delivery of five new planes from Franco-Italian firm ATR just before renewed US sanctions go into effect. 

"Based on existing agreements, five new ATR aircraft will land at Mehrabad Airport at 9 am (0430 GMT) tomorrow (Sunday)," the national carrier said on its Telegram channel. 

The new ATR-72600 planes are part of a deal for 20 new aircraft that Iran Air agreed to buy in April 2017, of which eight have so far been delivered. 

The deal was thrown into doubt by the US decision to withdraw from a 2015 nuclear deal between Tehran and major powers and reimpose sanctions, part of which are due to resume from Tuesday. 

Iran says US sanctions are endangering lives by blocking the sale of new planes and spare parts for its aging fleets. 

Iran's Aseman Airlines was ordered to ground its fleet of ATR planes in February after one of them crashed in the Zagros mountains, killing all 66 people onboard. 

Photo Credit: IRNA

Total Says Chances of Iran Sanctions Waiver 'Very Slim'

French oil major Total said Friday the probability of winning an exemption from US sanctions against Iran to continue a major gas field project was very faint.

The energy giant had already warned that, unless Washington granted it a waiver, it would pull out of the South Pars 11 project which it started in July 2017, two years after Western powers signed a nuclear deal with Tehran prompting the return of many businesses to Iran.

But earlier this month, President Donald Trump announced his withdrawal from the deal, and told companies that they face sanctions if they do business with Iran.

Iran's oil minister on Wednesday gave Total 60 days to win a sanctions waiver from Washington before it would lose its stake in the multi-billion-dollar project.

But on Friday, Total's chairman Patrick Pouyanné told shareholders that the prospect of a sanctions exemption was dim.

"The probability of us getting an exemption is very slim", he said.

Total said earlier this month that it has USD 10 billion of capital employed in its US assets, and US banks are involved in 90 percent of its financing operations, making Total highly vulnerable if targeted by any US actions.

By contrast, Total said it had spent less than EUR 40 million  (USD 47 million) on the Iranian project, which it runs with its local partners CNPC and Petropars and which is dedicated to the supply of domestic gas inside Iran.

A withdrawal from the Iran project would not affect Total's current overall production targets as the group had since opened up other growth opportunities, it said.

Meanwhile, Tehran said that Chinese state-owned oil company CNPC will replace Total on the gas project if the French company pulls out.

Photo Credit: IRNA

Iran Sets Sanctions Waiver Deadline for Oil Giant Total

Iran's oil minister on Wednesday gave French energy giant Total 60 days to win a sanctions waiver from Washington or it would lose its stake in a multi-billion-dollar gas project.

"Total has 60 days to negotiate with the US government," said Bijan Zanganeh, according to the oil ministry's Shana news agency. 

"The French government too can have negotiations with the US government during these 60 days for Total to stay in Iran."

Total was the only western firm to finalize an investment deal in Iran's energy sector following the 2015 nuclear deal, from which Washington withdrew earlier this month.

It signed the agreement last July to become the lead partner in a USD 4.8 billion project to develop the South Pars 11 gas field, alongside the China National Petroleum Corporation (CNPC) and Iran's Petropars. 

But after Washington quit the deal and pledged to fully reimpose sanctions by November, Total has said it will be impossible to continue unless it gets a specific waiver from Washington. 

If the French firm fails to win an exemption, CNPC "will replace Total in this project," Zanganeh said.

The oil minister did not explain why the French firm only had 60 days, with US sanctions on foreign energy companies in Iran not due to kick in until November 4. 

Even before Washington pulled out of the nuclear deal, Iran had struggled to attract investment into its oil and gas sector. 

The only other deal was a $742 million (600 million euro) deal with Russian state-owned firm Zarubezhneft to boost production at two oil fields in the western province of Ilam. 

Hardliners in Iran had opposed foreign investment in the energy sector despite the government saying billions were needed to realise its potential. 

"Iran failed to attract much energy investment, even when conditions were at their most favorable," wrote the US Center on Global Energy Policy in a recent briefing note.  

"The country was far too slow in unveiling its new Iran Petroleum Contract, and when it did, potential investors complained that the terms were unattractive."

Photo Credit: IRNA

France's Total To Seek Waiver If US Revives Iran Sanctions: CEO

French energy giant Total will push ahead with a $4.8 billion deal to develop an Iranian gas field and will seek a waiver if Washington re-imposes sanctions, the firm's CEO has said.

US President Donald Trump has threatened to withdraw from a 2015 deal curtailing Iran's nuclear program in exchange for sanctions relief, unless it is "improved" by May 12.

"If the US decides to put back the sanctions, we have to look at what the consequences are," Total chief Patrick Pouyanne said in an interview with Abu Dhabi daily The National published Monday.

"Then we will see, either Donald Trump decides to maintain the waivers and we will move on with the project, (or) we will ask for a waiver from the US authorities."

Defying pressure from Washington, Total signed a deal with Iran in July to head up an international consortium to develop Iran's vast South Pars offshore gas field, alongside China National Petroleum Corporation (CNPC) and Iran's Petropars.

In January, Trump demanded changes to what he has called a "terrible" nuclear deal or the United States would withdraw. European parties to the agreement are desperate to save it and have been scrambling to find ways to persuade Trump not to rip it up.

If Washington does walk away from the deal, Pouyanne said, Total will argue that as the project was "awarded prior to that decision during the period of time that we could sign."

That could allow the firm to benefit from a clause allowing the gas agreement to stand.

Photo Credit: IRNA