Its management of these reserves mainly over the past two decades has largely affected economic and industrial indicators of the country. Norway used to depend on foreign companies for exploration and development of oil and gas reserves, but now it owns state-of-the-art technology which serves different spots in the world. Iran greatly values Norway’s petroleum industry because of its self-acquired technology and years of cooperation in the past. Norway’s Statoil was among foreign companies which pulled out of Iran’s projects due to international sanctions targeting the Islamic Republic’s energy sector. But the recently-sealed nuclear deal between Iran and world powers – thanks to the administration of President Hassan Rouhani – is expected to attract foreign oil companies back into Iran.
In
order to get familiar with Norway’s future energy cooperation with Iran
under the new circumstances, Iran Petroleum has conducted an interview
with Norwegian Ambassador to Tehran Jens-Petter Kjemprud.
Q: As
the first question, could you please tell us your assessment of the
influence of Iran’s nuclear deal with P5+1 on Tehran-Oslo relations?
A:
The P 5+1 nuclear deal is a historic breakthrough in Iran’s relations
with the international community in general and the US and Western
countries in particular. It is an important basis for further
normalizing relations and developing political, economic and cultural
ties bilaterally and through multilateral arenas. Both parties (Iran and
the P5+1) must now carefully consider why earlier attempts of reaching a
permanent deal, like in 2003, did not succeed. Both parties must also
deliver dutifully on the agreed measures to be taken in the 6 month
interim period. Learning from past experiences and delivering on the
intermediary deal will create the necessary trust and thus facilitate a
permanent deal which in the end will provide Iran the opportunity to
deal with the rest of the world free of any sanctions.
Q: How do
you evaluate the current level of cooperation between Norway and Iran?
How will this cooperation change, once sanctions against Iran are eased?
A: The current level of cooperation between Iran and Norway is seriously hampered by the multilateral as well as US and EU unilateral sanctions hitting third parties. Economic cooperation, trade, business relations and investment has “dried” up because of the sanctions, in particular since the imposition of heavier sanctions during the last 2-3 years. There is a huge untapped potential in Iranian-Norwegian cooperation and we know that Norwegian and Iranian companies are following the nuclear talks closely to be ready to tap the potential when sanctions relief allows.
Quite obviously, if you look at Iranian-Norwegian
[relations], especially in oil sector before the latest sanctions were
imposed; there was a quite comprehensive cooperation in the oil sector.
Oil companies [like] Statoil had quite an important role in the South
Pars [gas] field and in a few other fields, as well. So although Statoil
has not decided to come back, they are obviously following the
situation.
Q: Iran’s new administration is widely expected to
broaden its ties with the West and Western oil companies, including
France’s Total and Royal Dutch Shell, showed interest in Iran’s energy
sector, but we did not hear anything from Statoil. Why?
A: If I
knew I would not be able to reveal business secrets. But I feel quite
certain and I presume that they both are looking into what is happening
now in Geneva, in the new agreement and after they are doing whatever
they think is right to be able to take advantage of the possibilities
which will be open if you have a final agreement. The temporary
agreement for the sanctions allows certain development and then you go
into new negotiations and then for the eventually lifting of all
sanctions.
Q: What are the potentials for the expansion of
cooperation of the two countries? In case sanctions are fully lifted in
the coming months, which sector will Norway prefer to cooperate with
Iran in?
A: There is a wide range of areas of cooperation which
would be of mutual benefit. This includes of course the petroleum sector
including the supply services, but also a number of other sectors like
in particular specialized fertilizers, quality and certification
services to name a few. Other areas could be identified.
I think
definitely the petroleum sector will be important. We have experience
there from the past, [experience of] working in Iran. I think in
addition to sanctions, also the revision of the framework [of the
contracts] and the agreements which are now revised could give further
impetus to international oil companies coming back. Of course the
petrochemical sector as such is also quite interesting. And if sanctions
are lifted I guess they will also be very interested in the Iranian
market. It will be in the interest of Iran not only as an oil producer
but also a huge market. And so many countries have been active before
but their operations have been restricted by the sanctions. So the fact
that Iran’s a big market, it’s good for Iran and good for other
countries to have common mutual benefits which I think should serve as
an encouragement for both parties to finalize a deal. So these mutual
benefits for having a deal I think is an important push factor for
reaching a deal. If you see some of the sanctions [are] lifted now for
example for the airline, civil aviation, car industry, it’s not only a
good deal for Iran but also for other countries cooperating with Iranian
companies in these businesses. So I think the future benefit issue is
quite important.
Q: Given Iran’s massive hydrocarbon recourses, what role can Iran play in the global energy scene, especially in Europe?
A:
On the global energy scene Iran, with its abundant reserves in oil and
gas, is among the most important players even today under sanctions. If
the continuation of the nuclear talks succeeds Iran could increasingly
expand its stature and role. As for Europe both oil and gas supplies
could beneficial. As Norway is one of the biggest gas suppliers to the
European market today, future coordination and cooperation between the
two countries would be beneficial. Norway is an observer member of the
GECF and participated in the recent ministerial meeting in Tehran.
Through this organization, now under a very capable Iranian chair, I
forecast desirable horizons for future cooperation.
Q: Norway’s
Statoil has already operated development projects in Iran. Are Statoil
and other Norwegian companies willing to return to Iran’s oil and gas
projects?
A: Statoil and Hydro have now merged their petroleum
activities under the Statoil umbrella. As you know Statoil had very good
experiences in Iran, especially through their role in the South Pars
field but are currently not active in Iran due to the sanctions. Given
the current developments, most oil companies are following closely the
developments in Iran and I presume this includes Statoil and possibly
other Norwegian companies.
Q: Norway has in the past trained
Iranian experts. Do you think that these training programs will continue
in the short, medium or long term?
A: Transfer of knowledge and
technology has been severely hit by sanctions. There is a solid basis
for resuming cooperation in this field. There are also many Iranian
experts working in the Norwegian oil industry, today. Therefore, when
the situation allows we should carefully look into future cooperation in
this field.
Q: What task has been assigned to the Norwegian
Embassy in Tehran with regards to oil and gas cooperation between the
two countries? Have you held talks with Iranian oil officials?
A:
Our predominant role is to secure Norwegian interests in Iran and
continuously look for opportunities of mutual interests and common
benefits for the two countries. The oil and gas sector is probably the
most important, but not the only sector the Embassy is trying to follow.
However, the real experts work for the companies and our role is the
facilitator’s role, if and when it is needed. I; however, hope to meet
your new Minister soon to discuss the overall framework for the oil
sector in Iran as a basis for facilitating possible future cooperation.
Q:
Norway has progressed significantly in oil and gas technology and
development projects. Do you have any plans to provide other countries
including Iran with this technology?
A: As I said above,
technology transfer is one important aspect of cooperation. Norway has
through research and developing of the oil and gas sectors acquired
technologies that give us some of the highest recovery rates in the
international oil and gas environment. This includes also the ability to
stop flaring of gas and utilize the resources efficiently. Research and
investment is required, and I believe this is where Iran could benefit
substantially in the future.
Q: Given Iranian oil industry’s
potentials for investment and Petroleum Minister Bijan Namdar Zangeneh’s
policy of reviewing oil contracts in order to make them more
attractive, are your government and Norwegian oil companies willing to
invest in Iran’s projects?
A: We are following closely the
revision of policies and contracts announced by the Minister and believe
that such a development could further increase the interest of
multinational oil companies in Iran as the possibilities for investment
will reemerge on the back of the Geneva talks.
Q: You mentioned
you are waiting to see how Iran’s Petroleum Ministry will define the
terms of new oil contracts. Statoil and Hydro have already struck
buy-back contracts with Iran. What points do you think should be taken
into consideration in the new contracts to attract Norwegian companies?
A:
Well although I am a lawyer by profession and I am not an expert in the
contracts, I understand from talking to the Iranian [Petroleum]
Ministry and the Norwegian companies that the current contracts are less
attractive to foreign companies and now the ministry is looking into
revising the contracts to be more attractive for investors. So that
seems to be an incredibly important move to get the companies, when
sanctions are lifted, into the countries as fast as possible.
Q: What do you think of future oil and gas cooperation between Iran and Norway?
A:
I am an eternal optimist and what is happening just now with the
interim deal and new round of negotiations, brings hope and
expectations. Before coming to Iran I told a Norwegian newspaper that
changes would come. Now I urge everyone to stay optimistic and
constructive at the same time emphasizing the need to manage
expectations in the short term. We should allow ourselves to be carried
away a little by the breakthrough agreement, but also shoulder the
responsibility to carry through the remaining issues of contention. The
small steps will only alleviate and remove some impediments of
cooperation and suspend some sanctions. There is need to rebuild trust
and identify and solidify the convergence of common interests which I
think must be the basis for a solid understanding for rebuilding solid
relation. The convergence of interests is there, let us treasure and
develop it for a lasting deal to be achieved.
Q: Given the
present political circumstances about Iran, does the Norwegian
government have any plans regarding broader ties with Iran?
A: I
usually answer that by saying that before I came here, I was
interviewed by a Norwegian newspaper on Iranian-Norwegian relations, and
I said that I believe there would be changes in Iran's relations with
the international community, during my duty there. Not because of me,
but because circumstances was ripe. I predict that much will change,
what we are seeing these days in Geneva accords and new negotiations
coming up, it is changing the whole relationship with the international
community.
Q: As the last question, how well does Iran Petroleum monthly help you get information about Iran’s petroleum industry?
A:
It is extremely important for us as a source to follow the
developments, we get a few copies from you, some of which are sent to
Norway and I hope you will continue sending us more copies because it’s
very useful for updating our information. We at the embassy are not
expert in the oil sector. So it’s important for us to keep Norwegian
companies informed about developments. I’m really impressed by both the
content and format of the magazine. Congratulations!
What I have
suggested in the feedback was that at some stage maybe you could also
have foreign experts on the Iranian oil sector and global or regional
developments could give some other perspectives and also create a debate
with domestic audience.
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