Chemical giant BASF cools on Iran citing slow sanctions removal

By bne IntelliNews February 27, 2017

The world’s largest chemical company, Germany’s BASF, has said it is in talks for a possible investment of its oil and gas division in Iran, but that it is not yet ready to move to a decision because it is unclear how the country will be affected by economic sanctions moving forward, a Reuters report said on February 24.

"We can't see that the lifting of sanctions is being implemented at the speed that was initially expected," BASF CEO Kurt Bock told a news conference after the release of the company’s 2016 financial results.

BASF’s position echoes that of several other major foreign companies which were initially enthusiastic about entering the post-sanctions Iranian market but have since slowed down their approach given US President Donald Trump’s aggressive stance towards Tehran and remaining hurdles such as remaining dollar restrictions in banking transactions.

"We are trying to assess whether it's possible for our oil and gas business to gain a foothold in Iran. We have been invited by the national authorities. The evaluation process is ongoing," Bock also reportedly said.

On February 22, Korean Airlines said it had requested a postponement of the start of its planned flights to Tehran, citing concerns generated by Washington’s policy approach towards Iran.

French oil major Total, meanwhile, is holding up a final investment decision on the South Pars gas field phase 11 project, and low-cost carrier Air India Express has deferred the launch of its direct flights between the Indian subcontinent and Iran.

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