October 15, 2010 / 7:46 AM / 9 years ago

UPDATE 2-Japan's Inpex quits Iran Azadegan oilfield project

* Agreement with Iran state oil firm had been expected

* Pullout follows US sanctions over Iran nuclear programme

* Inpex: no plan to change year’s earnings projections (Adds U.S. reaction, paragraph 5-6)

TOKYO, Oct 15 (Reuters) - Inpex Corp (1605.T), Japan’s top oil explorer, has pulled out from Iran’s Azadegan oil field project as expected, after U.S. sanctions against Iran over its nuclear programme posed a potential threat to the company’s business.

Inpex, which has invested 12.5 billion yen ($153 million) in the giant project, said on Friday that the agreement with state-run National Iranian Oil Company (NIOC) would have only a limited impact on its earnings.

It said it had no plans to change its group earnings projections for this business year.

Inpex had been weighing a withdrawal from Azadegan to avoid possible harm to its business, as it would have faced problems raising funds from U.S. financial institutions and its global development projects could have been hindered if it were subject to U.S. sanctions.

In Washington, State Department spokesman P.J. Crowley said the United States welcomed Inpex’s decision, a move he said “underscores that there are risks in dealing with Iran.”

“The company’s actions are part of a strong and emerging consensus not only of governments but also from the private sector, that has come together to send a powerful and united signal to Iran that it should meet its international obligations and begin debate seriously on its nuclear program,” he said.

Japan’s trade minister said earlier this month that Inpex, which had a 10 percent stake in the Iranian oil field, was not on a list of firms targeted by U.S. sanctions against Iran, implying the pullout was already in the works.

NIOC had a 90 percent stake in the project before the Inpex pullout.

“After proper consultations with the Japanese government, we chose to withdraw,” an Inpex spokesman said. “We no longer own the 10 percent stake.”

The spokesman added that the company did not expect to pay compensation to Iran, but he did not specify whether the company would recover its investment in the project.

Azadegan was the OPEC member’s biggest oil find in 30 years when announced in 1999, with oil-in-place of 26 billion barrels and recoverable resources then estimated at about 6 billion barrels, and is expected to cost at least $2 billion to develop. ($1=81.46 yen) (Reporting by Osamu Tsukimori and Deborah Charles in Washington; Editing by Edmund Klamann and Jerry Norton)

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