x

Abu Dhabi, UAEFriday 22 June 2018

BP delays work on gas field over Iran sanctions

The company co-owns a North Sea operation with an Iranian regime subsidiary

British Petroleum (BP) Chief Executive Bob Dudley addresses The 22nd World Petroleum Congress in Istanbul on July 12, 2017. Ozan Kose / AFP
British Petroleum (BP) Chief Executive Bob Dudley addresses The 22nd World Petroleum Congress in Istanbul on July 12, 2017. Ozan Kose / AFP

British Petroleum (BP) has announced it is deferring new work on a gas field it co-owns with a subsidiary of Iran’s government-owned oil company because of impending US sanctions on the Islamic Republic after President Donald Trump pulled out of the nuclear deal.

The oil and gas company said its ongoing work at the Rhum gas field northeast of the Scottish city of Aberdeen in the North Sea will continue. But a new well was to be drilled that the company is now postponing work on until the effect of new US sanctions becomes clear.

"BP has decided to defer some planned work on the Rhum gas field in the North Sea while we seek clarity on the potential impact on the field of recent US government decisions regarding Iran; Rhum is co-owned by an Iranian company," a company spokesperson told The National in a statement. "BP always complies with applicable sanctions".

BP is currently in the middle of a sale of its stake in the field to Serica Energy, which it agreed 50 per cent.

“Both companies remain committed to completion of the transaction. BP and Serica are now in discussion with the UK and US authorities to better understand the situation and steps that may be required to ensure continued operation of Rhum," the statement continued.

Oil prices have increased on the back of tensions between Iran and the US, with Secretary of State Mike Pompeo promising some of the strongest sanctions on the country "in history".