Belarus terminates cooperation with Iran

April 22, 2016 17:59

The company “Belorusneft” decided to cancel the contract concerning the development of the Jufeyr field in Iran, reads a statement posted on the official website of "Belorusneft" on Wednesday.

“The possibility of the termination of the contract at the end of each stage was provided by the contract”, the report says.

“The possibility of the termination of the contract at the end of each stage was provided by the contract”, the report says.

"Belorusneft" says that the contract concerning the development of the Jufeyr field was signed in 2007 where the company Belorusneft was one of the implementers regarding development of deposits in several stages. The first stage was completed in September 2010, “In the course of the development new data has been revealed concerning geological structure of the field, which caused changes in the technical, financial and economic conditions of the project”, the statement said.

“In the course of the development new data has been revealed concerning geological structure of the field, which caused changes in the technical, financial and economic conditions of the project”, the statement said.

“Therefore the company “Belorusneft” decided to terminate the contract following the completion of the first stage”.

The Iranian oil circles explain the termination of the contract between the companies due to failure of Belarus to fulfill its obligations. Under the agreement, “Belorusneft” promised to extract at least 3.5 thousand barrels per day, while in reality it was less than 2.8 thousand barrels per day.

Comment

Benefits from such cooperation were initially controversial, moreover, it linked to the first economic sanctions by the USA (the US market was lost). It is very likely that the conflict is based on purely economic issues. Belarus has estimated the cost-benefit and took the opportunity to terminate the contract. It implies Belarus is not ready to be a donor and to suffer losses while implementing international projects with its ideological allies. Iran also seems to adhere to this point of view.