Wednesday, August 24, 2016

Eye on Iran: Iran to Sign First Oil Deals in 2017






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Bloomberg: "Iran is set to sign major oil and gas deals with foreign companies in the second half of next year, its first such contracts since international sanctions were lifted in January, according to Wood Mackenzie Ltd. The first oil under the agreements will flow in 2020, Homayoun Falakshahi, a research analyst at the consulting firm, said Tuesday in an interview in London. Iran has worked on the terms of the Iran Petroleum Contract -- known as the IPC -- for the past three years and should finalize them by the end of 2016, he said... 'It comes down to how good the new contracts are,' he said. 'It's more likely they will still remain very tough; we are probably going to see a few deals but I don't think we are going to see a huge inflow of companies.' While the new IPC won't be as onerous as the previous fiscal terms, known as buybacks, they may still be among the harshest in the world, according to the analyst." http://t.uani.com/2bFN4xm

Reuters: "Iran's Vice-President Eshaq Jahangiri has told the oil and finance ministries to start using the approved new draft for the Iran Petroleum Contract (IPC) for oil and gas deals, the Oil Ministry's news agency Shana reported on Monday. The launch of the IPC has been postponed several times as hardline rivals of President Hassan Rouhani resisted any deal that could end the so-called buy-back system under which foreign firms were banned from owning stakes in Iranian companies. Oil Minister Bijan Zanganeh attended a parliamentary session on Sunday to answer criticisms of the IPC. He said last week the IPC would need minor amendments but that implementation of its final draft would not need the approval of parliament. Shana published the general terms and conditions of the IPC, specifying that the new contracts are divided into three main categories: exploration, development of discovered fields that would lead to production, and enhanced oil recovery (EOR) to increase output... Only Iranian exploration and production companies whose credibility has been approved by the National Iranian Oil Company (NIOC) can partner with foreign oil companies." http://t.uani.com/2bi8OuV

Asharq Al-Awsat: "Iran runs six military camps near the city of Kirkuk in northern Iraq, including around 1,500 officers and commanders from the Quds Force of the Iranian Revolutionary Guard. Tehran is also planning to open new military camps between the cities of Kirkuk and Mosul reaching to the Syrian border, informed sources told Asharq Al-Awsat newspaper. Head of the military wing at the Kurdistan Freedom Party Hussein Yazdan said: 'Mohammad Shahlaei, a veteran commander of the Quds Force, currently supervises the operations and movements of this Revolutionary Guards unit in northern Iraq.'" http://t.uani.com/2bgormM

Congressional Action

Free Beacon: "The Obama administration is withholding from Congress details about how $1.3 billion in U.S. taxpayer funds was delivered to Iran, according to conversations with lawmakers, who told the Washington Free Beacon that the administration is now stonewalling an official inquiry into the matter. The Departments of State, Treasury, and Justice have all rebuffed a congressional probe into the circumstances surrounding the $1.3 billion payment to Iran, which is part of an additional $400 million cash payout that occurred just prior to the release of several U.S. hostages and led to accusations that the administration had paid Iran a ransom. The Obama administration has admitted in recent days that the $400 million cash delivery to Iran was part of an effort to secure the release of these American hostages, raising further questions on Capitol Hill about White House efforts to suppress these details from the public. The $400 million was part of a $1.7 billion legal settlement reached with Iran earlier this year. Congressional inquiries into how this money reached Iran are failing to get answers. The State and Treasury Departments declined on Tuesday to answer a series of questions from the Free Beacon about the method in which U.S. taxpayer funds were paid to Iran. The administration is also withholding key details about the payment from leading members of Congress, including Sens. Ted Cruz (R., Texas) and Mike Lee (R., Utah), who launched an inquiry into the matter earlier this month. The Departments of State, Treasury, and Justice all failed to respond to the inquiry by Monday's deadline, according to congressional sources tracking the matter." http://t.uani.com/2bi1zTt

Business Risk

ABC (Australia): "Australia could be losing billions of dollars a year in trade with Iran thanks to ties that at least one domestic bank has to the United States. An Australian businessman has told the ABC he would like to trade with Iran, but his financial institution said it wanted no part in his trade, fearing a backlash from the US. Australia has dropped trade sanctions with Iran, but in the United States they remain in place. Sydney-based exporter and importer Christopher Cox told PM he took his business to the ANZ bank because of its far-reaching international branch network, compared with other local banks. But ANZ said it would not provide the channel needed to send and receive between Australia and Iran, leaving Mr Cox extremely frustrated, as all the other necessary financial and business infrastructures to do business abroad are in place... In a statement provided to the ABC in regards to the matter, ANZ said: 'While there has been a lifting of some sanctions to Iran by Australian authorities, as an international bank we continue to comply with the US Department of the Treasury's Office of Foreign Assets Control (OFAC) which bans transactions to and from Iran.'" http://t.uani.com/2bvXn6t

Sanctions Relief

AFP: "Iranian firms want to participate in the construction of a massive canal across Nicaragua that a Chinese company has vowed to build, Iranian Foreign Minister Mohammed Javad Zarif said Wednesday. Representatives of private Iranian construction companies accompanying Zarif on a visit to Nicaragua's capital discussed the possibility of getting a slice of the $50 billion project, the minister told a news conference. The ambitious plan calls for a waterway linking the Pacific and Atlantic oceans that would rival the century-old one in Panama, which has recently been expanded to take bigger ships... Zarif made Nicaragua the second stop of a Latin American tour that began Monday in Cuba and which was to include Ecuador, Venezuela, Bolivia and Chile." http://t.uani.com/2bgf89q

TASS (Russia): "The Russian Helicopters holding (subsidiary of Rostec State Corporation) is in negotiations with the Iranian colleagues on the supply of the light helicopters Ansat and Kamov Ka-226T for Iran's Health Ministry, Deputy Director General of the holding Alexander Shcherbinin said on Tuesday. 'Russian Helicopters conducts negotiations on the supply of the Ansat and Ka-226T light helicopters for the Iranian Ministry of Health and Medical Education. In addition to the delivery of the helicopters, the issue of organizing their assembly in Iran is being considered. According to our estimates, Iran needs about 60 Russian light helicopters,' Shcherbinin said. The holding's press service said that from August 23 to 25 Russian Helicopters will for the first time hold a seminar for the Iranian operators and potential customers of Russian helicopters." http://t.uani.com/2bi4NX2

Foreign Affairs

WSJ: "Iran has told members of the Organization of the Petroleum Exporting Countries that it would attend talks next month on oil production, delegates to the cartel said, adding to hopes for an agreement to curb output. Iran circulated a letter to OPEC members, saying it would attend informal talks in Algeria late next month among the group's members, according to an OPEC delegate who saw the one-sentence missive. Other delegates said they were told of Iran's attendance by high-level OPEC officials... OPEC, a 14-nation producer group that controls over a third of the world's crude-oil production, isn't scheduled to meet formally until November in Vienna. But members have said they would hold talks at the International Energy Forum in Algiers, scheduled for Sept. 26-28... OPEC's new secretary-general, Mohammad Sanusi Barkindo, will travel to Tehran and Qatar next month ahead of the Algiers summit to discuss freezing production, OPEC delegates said on Tuesday. It would be Mr. Barkindo's first official trip since he took the helm at OPEC this month." http://t.uani.com/2bi3Uhv

Iraq Crisis

Reuters: "Shi'ite militias in Iraq detained, tortured and abused far more Sunni civilians during the American-backed capture of the town of Falluja in June than U.S. officials have publicly acknowledged, Reuters has found. More than 700 Sunni men and boys are still missing more than two months after the Islamic State stronghold fell. The abuses occurred despite U.S. efforts to restrict the militias' role in the operation, including threatening to withdraw American air support, according to U.S. and Iraqi officials." http://t.uani.com/2bzL7z2

Al-Monitor: "Iraq's popular militias have no plans to merge with the army, Jean Aziz reports from Beirut, where a meeting was held among Western diplomats and representatives, nongovernmental organizations and officials from Iraq's Popular Mobilization Units (PMU). 'We will be a military force that is part of the Iraqi state, but not part of the Iraqi army. This is due to many reasons that we explained to them, namely the corruption spread within the Iraqi government institutions, and I think they understood our point of view. We made it clear that we will be an alternative army subordinated to the state, just like Iran's [Islamic] Revolutionary Guard Corps,' an Iraqi militia leader told Aziz." http://t.uani.com/2bOVelr

Domestic Politics

Gulf News: "'Thirty per cent of Iran's population are suffering from poverty and hunger ...'. This is not a statement issued by the Iranian opposition group known as the Mujahideen Khalq Organisation (MKO), nor by other Iranian organisations abroad. Or for that matter by any Arab body. It is an official statement issued last week by Ali Akbar Saari, attached to Iranian health ministry. The statement has angered ordinary Iranians, who see tens of billions of dollars worth of oil revenues getting wasted in financing terrorist organisations or in wars that Iran has nothing to do with. How can one imagine such a high percentage of poor in a country rich in natural resources, particularly in oil and gas." http://t.uani.com/2bzMD45

Opinion & Analysis

Peter Berkowitz in RealClearPolitics: "But there are broader questions about the Obama administration's Iran dealings than dissembling about the mechanics of hostage negotiations. They form a substantial part of Jay Solomon's painstakingly reported book, 'The Iran Wars: Spy Games, Bank Battles, and the Secret Deals That Reshaped the Middle East.' It shows that the Obama administration's far-fetched denials of ransom payment are part and parcel of more fundamental problems. The Joint Comprehensive Plan of Action -- the July 2015 Vienna agreement between Iran, on one side, and, on the other, the United States, the other four permanent members of the U.N. Security Council, Germany, and the European Union -- was for the Obama administration, Solomon writes, 'the most important initiative of its second term and the defining foreign policy legacy of Barack Obama's presidency.' Solomon stresses, 'President Obama, from his first days in office, pursued an opening to Iran and Supreme Leader Ali Khamenei with an obsessive commitment.' To win Ayatollah Khamenei's trust, Obama withheld support for the spontaneous democratic uprising against the corrupt June 2009 Iranian presidential election. The administration also deceived the public by undertaking secret negotiations with Iran and conducting outreach and talks 'behind the backs of the Security Council and the United States' closest Middle East allies, including Israel and Saudi Arabia.' During negotiations - both those conducted openly and those done surreptitiously - Obama's diplomatic team, led by Secretary of State John Kerry, made numerous, significant, unreciprocated concessions. And to avoid antagonizing Khamenei, Obama decided that America should stand by and do practically nothing as Syria's president and Iranian client, Bashar al-Assad, slaughtered hundreds of thousands of people, wounded more than a million others, and drove in excess of 12 million Syrians from their homes. A Wall Street Journal foreign correspondent for nearly two decades, Solomon is an old-school reporter who regards his principal mission as getting the story right. On the basis of extensive and courageous reporting from the Middle East and assiduous coverage of the ebb and flow of power in Washington, he discloses the multiple dimensions-political, diplomatic, economic, military, and clandestine-of America's post-9/11 struggles with Iran. Although Obama was determined to correct what he regarded as George W. Bush's mistakes in the Middle East, the 44th president's policies resembled, in a crucial respect, the 43rd's: Both vied with, Solomon's book reveals, an adversary we didn't understand. Obama thought he was replacing a foolish war with smart diplomacy. But a central question Solomon's book explores is whether that approach was effective. His scrupulous reporting will do much to corroborate the judgment of those who believe that, for the sake of Obama's supposedly crowning foreign policy achievement, the president paid much too high a price... Solomon observes that 'at the heart of Obama's philosophy was a sense that' his administration 'had righted history' with the Iran deal. That's a messianic sense. From paying what bears an uncanny resemblance to ransom, to disregarding state sponsorship of terrorism and declining to confront epic state brutality, to triggering nuclear proliferation in the name of nonproliferation, what will a messianic sense not justify?" http://t.uani.com/2bgrMSV

Bret Stephens in WSJ: "In the fall of 1940 the governments of Japan, Italy and Germany-bitter enemies in World War I-signed the Tripartite Pact, pledging mutual support to 'establish and maintain a new order of things' in Europe and Asia. Within five years, 70 million people would be killed in the effort to build, and then destroy, that new order. The Pact was the culminating act in a series of nonaggression, friendship and neutrality treaties signed by the dictatorships of the day, sometimes to deceive anxious democracies but more often to divvy up the anticipated spoils of conquest. So it's worth noting our new era of cooperation between dictatorships-and to think about where it could lead. The era began in July 2015, when Iran's Quds Force commander Qasem Soleimani paid a visit to Moscow to propose a plan to save Bashar Assad's regime in Syria from collapse. Iran and Russia are not natural allies, even if they have a common client in Damascus. Iranians have bitter memories of the Soviet occupation of Afghanistan in the 1980s, and the Kremlin has never been fond of Islamists, even of the Shiite variety. But what tipped the scales in favor of a joint operation was a shared desire to humiliate the U.S. and kick it out of the Middle East. 'America's long-term scheme for the region is detrimental to all nations and countries, particularly Iran and Russia, and it should be thwarted through vigilance and closer interaction,' Supreme Leader Ali Khamenei told Vladimir Putin during the Russian's visit to Tehran last November. Since then, Tehran has agreed to purchase $8 billion in top-shelf Russian weapons and is seeking Moscow's help to build another 10 nuclear reactors-useful reminders of how the mullahs are spending their sanctions-relief windfall. The two countries have also conducted joint naval exercises in the Caspian Sea. Just last week Russia used Iranian air bases (a little too publicly for Tehran's taste) to conduct bombing raids on Syria. All this is happening as the nuclear deal was supposed to be nudging Iran in a more pro-American direction." http://t.uani.com/2bFPJXz

Emanuele Ottolenghi in Forbes: "The Joint Comprehensive Plan of Action (JCPOA) reached last year between Iran and six world powers lifted sanctions against Iran's aviation sector, allowing aircraft manufacturers like Boeing and Airbus to sell aircraft to Iran. But the fact that those prohibitions have been lifted does not mean that the rationale behind them has changed. Iran remains the foremost state sponsor of terrorism in the world and is still number one on the recently-released Basel Anti-Money Laundering Index Report of 2016, which assesses the risk of money laundering and terrorist financing in 149 countries. Iranian commercial aircraft routinely violate international aviation rules by transporting arms and military personnel to Syria, and selling aircraft to Iran will expose manufacturers to the risk of becoming complicit in such activities. Tehran wants to buy up to 500 aircraft over the next decade to rejuvenate its aging fleet, and Airbus seeks to sell 118 of its own. Tehran has also struck a deal with the French-Italian ATR to buy 40 regional planes, and other deals are in the works with Canada's Bombardier and Brazil's Embraer. Despite Congressional opposition to the Boeing sale, the Iran Civil Aviation Organization (ICAO) expects this deal to go through. Given the Obama administration's support for the deal, this optimism is understandable, but premature. Once manufacturers take a hardnosed look at its terms, they will realize the risks far outweigh the benefits. The problem with the Islamic Republic's aircraft shopping spree is that Iran's state-owned airline, Iran Air, will be the sole company purchasing these aircraft. Its current fleet stands at 36 aircraft; its subsidiary, Iran Air Tours, has 14. Because it does not need so many planes, it is not likely to retain all of the aircraft it purchases. Iran Air will more likely act as a front for all other Iranian airlines, including, crucially, Mahan Air, which remains under U.S. sanctions for its ongoing support for Iran's military involvement in Syria." http://t.uani.com/2bOXusM
       

Eye on Iran is a periodic news summary from United Against Nuclear Iran (UANI) a program of the American Coalition Against Nuclear Iran, Inc., a tax-exempt organization under Section 501(c)(3) of the Internal Revenue Code. Eye on Iran is not intended as a comprehensive media clips summary but rather a selection of media elements with discreet analysis in a PDA friendly format. For more information please email Press@UnitedAgainstNuclearIran.com

United Against Nuclear Iran (UANI) is a non-partisan, broad-based coalition that is united in a commitment to prevent Iran from fulfilling its ambition to become a regional super-power possessing nuclear weapons.  UANI is an issue-based coalition in which each coalition member will have its own interests as well as the collective goal of advancing an Iran free of nuclear weapons.

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