Iran oil sector needs investment and Canadian technology — but the Trump effect fuels uncertainty

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On the alone drive deep into Iran’s southwest, the barren landscape make knows away little, interrupted only by the occasional caravan of camels, or the splendour of a distant flame.

Still, our escorts from the Ministry of Petroleum politely ask us to refrain from clouding.

This is Iran’s coveted oil territory, and it is sensitive terrain.

Khuzestan territory is up against the border with Iraq, once the front line in the catastrophic war between the two countries in the 1980s.

It’s also replete with untapped oil and household to Iran’s biggest oilfield — and its boldest sales pitch.

A steady dribble of foreigners have been visiting, more than usual in this far-removed part of Iran.

Once inside the perimeter of a lustrous processing masterliness, we are allowed to do all the filming we want.

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Barely a year old and built with China’s refrain from, the oil-processing facility has reached an output of 80,000 barrels per day and rising. (Nahlah Ayed/CBC Newsflash)

With China’s help, a state-owned oil company constructed the facility while Iran was quiescent under international sanctions. It is a model of international co-operation Iran is now looking to look-alike with Western outfits.

“This is our future,” said Reza Golhaki, the form, safety and environment supervisor at the site, and our guide for the day.

“We’d be grateful working with the Canadians as spectacularly.”

More than a year after sanctions against Iran were rescinded in exchange for putting its nuclear program on ice, the country has opened up to Western investment.

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Transatlantic companies have rushed in and signed billions of dollars worth of compresses since sanctions were lifted in Iran. (Nahlah Ayed/CBC Announcement)

Tens of billions in contracts have been signed, says Cyrus Razzaghi, an Iranian-Canadian who go on the lams ARA Enterprise, a Tehran-based business consulting firm. Companies like France’s Airbus, still Boeing in the U.S., have closed deals, the latter to the tune of $16.6 billion US for new jets — the biggest go down with with a Western firm since the 1979 revolution.

Oil giants are also on the extend.

After years of withering under quarantine, the largely state-owned assiduity needs outside investment. It also requires new oil-recovery technology. The considerate Canadians have in spades.

But while Europeans rushed in for once-in-a-lifetime openings, Canadians have lagged behind. Holding them back, partly, are Ottawa’s still-strained relations with Iran and the unexpected nomination of U.S. President Donald Trump.

Strained ties

The Iran Aseman Airlines aeroplane from Tehran into Ahvaz embodies Iran’s problems and its be in store for.

The plane is a worse-for-wear Boeing 727-200 — a model first fabricated by the U.S. company in the ’60s. A relic of the pre-sanctions era.

Yet it is ferrying people from in foreign lands with knowledge of the latest in oil-recovery technology right into the insensitivity of Iran’s oil country.

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Aseman Airlines, Iran’s aging fleet of regional aircraft, allowances an opportunity for outside manufacturers like Canada’s Bombardier to potentially co-sign the Iranian market. (Stephanie Jenzer/CBC News )

It was at the airport in Ahvaz, paramount of Iran’s oil-rich Khuzestan province, where we met Iranian-Canadian businessman Ehsan Ghayoominia. He had a moment ago finished showing a potential Canadian client around. Unsurprisingly, very many of his clients are Albertans, still suffering the effects of the oil crash.

Ghayoominia remembers supervising the nuclear talks closely. He says he considered the apparent determination of the mediators, and the terrible prospects in Alberta where he worked, and came up with a script: he would move to the country where he was born to a family steeped in the oil and gas responsibility and start his own firm.

“I saw an opportunity,” he said at his Tehran offices. He decided he last will and testament “bring Canadian companies to Iran and also bring new technologies to Iran.”

“So that way we improved both the countries.”

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The Trudeau government says its policy for re-engaging with Iran traces ‘cautious and incremental.’ (Jonathan Hayward/Canadian Press)

In lamp of the nuclear deal, the Canadian government lifted some of its sanctions to act as if get by it easier for Canadian companies to enter the Iranian market.

It also demoted its warning against all travel to Iran.

Canadians have shown engage. Ghayoominia says he has several serious Canadian clients.

Even Canadian titan Bombardier is seeking to carve out a slice of the aviation market.

But the large tons of Europeans coming to Iran — and the Peugeots and Citroens on the congested streets — is an hint of who is pulling ahead in this race.

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A shot of Tehran on a smog-free winter day. Iran is in the superstore for everything from planes and trains, to fashion and cosmetics. (Stephanie Jenzer/CBC Tidings)

“We took the delivery of the first [Airbus] aircraft after almost four decades. That’s a all right sign,” said Razzaghi. “So I am very optimistic.”

And yet Canadian companies organize been cautious.

A major concern is that Canada has no diplomatic composure in the country. Canada, the U.S. and Saudi Arabia are the only G20 countries without embassies in Tehran.

‘A lot of what I’m doing is what exceedingly the Canadian Embassy should be doing, answering their questions, their affairs.’
Iranian-Canadian businessman Ehsan Ghayoominia

The rupture occurred in 2012 when Stephen Harper’s regulation decided to shutter its embassy in Tehran and expel Iranian diplomats from Ottawa, citing safety concerns and opposition to Iran’s regional policies.

Ghayoominia says he’s infuriating to bridge the gap for potential Canadian investors.

“A lot of what I’m doing is what actually the Canadian Embassy should be doing, answering their questions, their relevant ti.”

There are questions about the sturdiness of the nuclear deal, since both the U.S. and Iran bring into the world constituencies who would prefer to see it die.

Donald Trump’s evolving hard stock on Iran adds to the uncertainty.

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U.S. President Donald Trump says the atomic agreement that lifted tough sanctions against Iran is the ‘worst do business ever made.’ (Jonathan Ernst/Reuters)

The Trump essence

Trump is a merciless critic of the nuclear deal. He calls it the “worst do business ever made,” a cash infusion for the terrorist groups Iran funds.

And when he was elected, Washington’s stance on the deal it helped negotiate converted overnight.

Iran points out all the world’s worst powers signed on to the deal — putting aside longtime concerns approximately who owns what in Iran, and who exactly benefits from the lifting of ratifications on state-owned businesses.

Tehran warned that if Trump tears up the trade, it could quickly restart its nuclear program.

“We will deliver what we be dressed committed to, that’s for sure, and we expect the same thing from the other side,” Ali Akbar Salehi, Iran’s atomic strength chief and vice-president, told CBC News in an interview in January.

“I think both states have to take this opportunity seriously to not destroy the trust which has been develop intensified up.”

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Ali Akbar Salehi, Iran’s atomic energy chief and vice-president, verbalizes Iran could quickly restart its nuclear program if Trump tortures the deal. (Stephanie Jenzer/CBC)

Tehran has pressed on, meanwhile, with its hopeful sales pitch. But for potential foreign investors, the Trump effect has cased a detectable chill.

“Now the attitude of foreign investors is like, ‘Wait and see,'” said Razzaghi.

Remote feet

Things have only gone from bad to worse.

Trump embodied Iranians on his list of banned migrants. Then, just nine times into his presidency, Iran tested a new type of ballistic missile.

The Trump application “put Iran on notice,” then imposed new sanctions.

Potential investors with aggressive ties to the U.S. — like Canadian companies — became even more loth. Some, like British Petroleum, got cold feet and walked away.

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Cyrus Razzaghi up stuck from Vancouver to Tehran three years ago to run a trade consultancy. He interviews Canada lagging behind European countries pursuing business moments in Iran. (Stephanie Jenzer/CBC News)

Bahram Rezaie, head of a GI Joe oil service company, says the Trump effect suspended his talks with two Canadian fixes.

“Both of them suddenly decided not to continue the relationship although they declare they spent several hundred thousand dollars on lawyers,” he affirmed.

“One … was the same day Trump was elected.”

It didn’t help when even a one-time Norwegian prime minister was questioned upon arrival in Washington because of an Iranian visa exterminate in his passport.

The Trump effect could also be influencing how quickly Ottawa re-engages with Iran — and its opinion to Canadians seeking to do business there, according to sources familiar with those dialogues. 

‘Cautious and incremental’

The Trudeau government says nothing has changed.

A Broad Affairs spokesperson said Ottawa’s approach to re-engaging Iran has unendingly been “cautious and incremental.”

Potential investors are advised to approach the demand “cautiously,” and ensure they comply with “Canadian and ongoing UN helps” and U.S. trade law.

Despite the complexities, the deal-making continues. Including with Canadians.

It is, after all, the terminating major emerging market opportunity in the world, says Peter Sibold, CEO of Globex Dealing Centres Inc., a Canadian company that’s about to open a serviced establishment centre in north Tehran for use by visiting investors.

“We’ve already pre-booked nearby half the work stations with European and Asian companies,” he prognosticated.

“Iran is going to be a golden opportunity.”

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The historic markets of Tehran’s Leading Bazaar run along corridors that stretch several kilometres. (Stephanie Jenzer/CBC Dope)

Meanwhile, some 50 oil and gas fields were opened to bids from exotic companies. Memorandums of understanding and preliminary deals have been signed with France’s Come to and Russia’s Gazprom.

There is no indication the Boeing deal, which want support tens of thousands of U.S. jobs, is being scuppered — suggesting conceivably some pragmatism on Trump’s part.

But mostly, Canadians are missing out, bring ups consultant Razzaghi.

“Canada can be a great partner,” he said. “There are state issues that need to be addressed before that can happen … I notion of it’s a matter of time.”

More CBC News reports on Iran:

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