Inpex announces withdrawal from Azadegan oil project+

TOKYO, Oct. 15 Kyodo -
Inpex Corp. said Friday it has decided to withdraw from an oil field
development project in Azadegan, southwestern Iran.
Inpex evidently reached the decision to avoid being included on a list of
companies subject to U.S. sanctions against Iran over the country's nuclear
program.
''We were afraid of adverse impacts, such as being shut out of access to U.S.
financial institutions'' in relation to operations not only in Iran but other
countries if Inpex continued to participate in the project, Kazuhiko Itano,
executive officer at the Japanese oil exploration company, said at a press
conference.
''In view of the international political situation, we consulted with the
Japanese government and made a comprehensive judgment,'' he added.
Inpex, which is 29 percent owned by the government, will have to give up a 10
percent interest it owns in the Azadegan project but will not pay a penalty.
''I heard the decision to withdraw was conveyed in a friendly manner to Iran,''
Economy, Trade and Industry Minister Akihiro Ohata told reporters at his
ministry.
Investments by Inpex in the project totaled 12.5 billion yen as of the end of
June and will not be recovered as no oil has been produced from the field as
yet.
While Inpex has already taken charges for half of the investment, it is
contemplating how to handle the remainder. As the company has drilling
interests in many countries, the effect of the latest decision on its
management is expected to be limited.
In 2004, the predecessor of Inpex Corp. acquired a 75-percent stake in the
Azadegan field, which has crude oil deposits estimated at 26 billion barrels.
Analysts said the company's withdrawal from the project will force Japan to
restructure its strategy for securing stable energy supplies.
But Ohata denied Japan's energy policy will be greatly affected as Inpex
operates in many parts of the world.
Tokyo-based Inpex was founded in April 2006 through the management integration
of Inpex and Teikoku Oil, and is listed on the First Section of the Tokyo Stock
Exchange.
==Kyodo
2010-10-15 22:12:36