Russia is expected to make an investment of around $40 billion in Iran’s petroleum industry following the signing of a memorandum of understanding between Tehran and Moscow on Tuesday, the Iranian Oil Ministry’s news service Shana reports. The MoU was signed during an online ceremony on Tuesday by Mohsen Khojasteh-Mehr, CEO of the National Iranian Oil Company, and Vitaly Markelov, deputy chairman of the Management Committee of Russia’s majority state-controlled energy giant Gazprom. Russia already has about $4 billion invested in Iran’s petroleum sector.
The new and vastly increased investment is considered partly a result of Western sanctions on both countries – Iran for violations of the 2015 nuclear deal between the Islamic Republic and the P5+1 countries and its alleged pursuit of nuclear weapons, and Russia for its invasion of Ukraine. “The issue of increasing Russian-Iranian cooperation in the economic sphere is especially relevant in light of the tightening of Western sanctions against Russia,” Russia’s official news outlet TASS reported.
The Russian funds are to be used in projects such as the development of Iran’s Kish and North Pars gas fields and six oilfields, boosting pressure in the South Pars Gas Field, completion of liquefied natural gas projects, swap of gas and petroleum products, and the construction of gas transfer pipelines.
Russian President Vladimir Putin arrived in Iran on Tuesday for meetings with his Iranian counterpart, President Ebrahim Raisi, on bilateral cooperation and negotiations over the Iran nuclear deal, and a tripartite summit with Raisi and Turkish President Recep Tayyip Erdogan focusing on the Syrian conflict.