The National: Iran’s energy sector gears up for post-sanctions era

In a sign that frosty relations between Iran and the West continue to thaw, David Cameron met Hassan Rouhani at the UN in New York late last month – the first encounter between a British prime minister and an Iranian president since the 1979 Islamic revolution. The meeting is the latest indicator that, after years of isolation, Iran is positioning itself for the potential lifting of international sanctions, a move that would revive the Islamic republic’s ailing energy industry, pave the way for its return as a major oil exporter and provide much-needed stimulus to the domestic economy.

Pending a final, comprehensive deal on the country’s controversial nuclear programme between Tehran and the five permanent UN Security Council members plus Germany (P5+1), relations with the rest of the world for the Islamic republic could return to normal as early as next year, a development that would not only reverse the fortunes of its struggling economy; it would also open the biggest bonanza for international energy companies since the removal of the Iraqi president Saddam Hussein in 2003.

Iran, holder of the world’s fourth-largest proved oil and the second-largest proved natural gas reserves, has been hard hit by UN and international sanctions imposed on the country in 2006 and 2010 on top of existing US sanctions. But it was the latest set of even more stringent measures enacted by the US and the European Union in late 2011 and 2012 that had the most devastating effect. MORE