US Treasury Grants BP License To Operate North Sea Field With Iran | Exploration & Production

BP Plc (NYSE: BP) and Iran’s state-run oil company received a license from the U.S. Treasury last year to operate their joint gas field in the North Sea following the lifting of Western sanctions on Tehran, BP said April 6.

Production at the Rhum Field was suspended in 2010 when Europe imposed sanctions on Iran over its nuclear program and only resumed four years later after Britain agreed to set up a temporary management scheme whereby all revenue due to Tehran would be held until sanctions were lifted.

Following the removal of European Union and United Nations sanctions on Iran in January 2016, the temporary management scheme ceased.

Iran regained control of its stake and on Sept. 29, 2016, BP obtained a license from the U.S. Treasury, through its sanctions enforcement arm—the Office of Foreign Asset Control (OFAC), to continue operations at the field, BP said in its 2016 annual report.

BP, which was founded more than a century ago as the Anglo-Persian oil company, has multiple business operations in the United States and therefore needs an OFAC license to avoid potential breaches of existing U.S. sanctions.

Go to E&P to read more.

My view: Although Trump’s unpredictability makes it difficult to forecast, the U.S. Treasury approval for BP to conduct joint operations with Iranian state-run company might be an indication that sanctions may not be reinstated. 

It is also possible that Rex Tillerson, the current U.S. Secretary of State, might played role in this decision. Perhaps, ExxonMobil has plans to expand its presence in the Middle East.