Three Indian Energy Firms Could Face Sanction for Iran Ties

Indian state owned energy firms ONGC, Indian Oil Corp. Ltd (IOCL) and Oil India Ltd (OIL) could face US sanctions for having energy ties with Iran, Press Trust of India reported citing US Government Accountability Office (GAO) report.

The three Indian companies are among the five global firms named by the US Government Accountability Office for having energy ties with Iran. The other two are China’s CNPC and Sinopec.

The report describes them as “foreign firms reported to have engaged in commercial activity in Iran’s energy sector between 8 November 2013, and 1 December 2014”, Press Trust reported.  

The US Iran Sanctions Act provides for steps against persons, including foreign firms, investing more than $20 million in Iran’s energy sector in any 12-month period.

The three Indian firms have been named for their stake in the Farsi offshore block in Iran.

US GAO had included only ONGC and OIL in its previous report last year and kept IOC out because of “insufficient information available”, Press Trust said. However, this year’s report has said, “The firm’s (IOC’s) 2013-14 annual report stated that the firm has a 40% participating share in the Farsi Block Project.”

According to Press Trust the GAO report cites ONGC’s annual report mentioning 40% interest in Farsi block as well as OIL’s annual report stating 20% stake in the block for being included in the report.

All the three firms gave similar response to US GAO saying the “exploration contract (for Farsi block) expired in 2009” and that they had “not carried out any activity after 2007 in the Farsi Block”.