Russia and Iran are looking for ways to step up cooperation


MOSCOW, 12 November, Russia and Iran in anticipation of a possible withdrawal of international sanctions held a meeting of the intergovernmental Commission, and discussed the key points of boosting the cooperation between the two countries.

In particular, the parties are negotiating about a possible involvement by Iran, Russian financing, conducting settlements in national currencies, which traditionally is not without its talk about cooperation in the oil industry.

The search for financial instruments

Minister of energy Alexander Novak, who co-chairs the intergovernmental Commission of Iran, said that currently the sides are engaged in the search of different tools for financing.

At present VNESHECONOMBANK is preparing an agreement with the Central Bank of Iran on the granting of credit for €2 billion With the Finance Ministry of Iran has applied to the Ministry of Finance of the Russian Federation to receive an export credit of $5 billion, the Ministry of Finance of the Russian Federation stated that the decision on allocation of the Russian loan to Iran is not accepted, the budget of the Russian Federation no.

Also Russia and Iran are discussing the possibility of conducting settlements in national currencies. “We’re looking for various tools which allow the funding of projects, – said Novak. – We are talking about the use of national currencies, the trade and balance that would allow to generate sources for mutual settlements”. Including Russia and Iran continue to consider the implementation of the agreement “oil in exchange for goods”. “We hope to use this mechanism to have the sources for financing joint projects”, – said the Minister. Novak said that “any transactions under these agreements can be implemented”. The head of the Ministry of energy did not specify the terms of these agreements.

Almost in every region there is a project

Alexander Novak also said that countries in the short term can increase trade to $10 billion.

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“I think we can leave in the near future to $10 billion in Almost every region we have a project,” he said. In particular, Iran initialed a part of the contract for railway electrification at $860 million out of a total contract volume of $5-6 billion overall, countries are discussing a long list of transport projects for a total value of more than $25 billion in Russian companies.

Zarubezhneft is interested in the development of the field Sangole in Iran. Novak noted that one of the competitive advantages of “Zarubezhneft” is that it focuses on increasing the oil recovery factor (ORF).

During the meeting, Technopromexport, a subsidiary of state Corporation rostec, signed with the Basic specialized company of Iran agreement on the generation of electricity in steam thermal power plants in Iran. The document envisages also the implementation of other energy projects on the territory of the Republic.

In addition, Rusgeology signed an agreement with the Ministry of energy of Iran, in which we’ll search for water resources in Iran. In addition, Russia and Iran signed an agreement on financing between the Bank “Russian financial Corporation” and the Bank of export development of Iran. Also a Memorandum was signed between the Ministry of transport and Ministry of roads and urban development of Iran on cooperation in combating pollution by oil and other substances of the seas.

Novak also said that Russian companies are ready to supply to Iran of agricultural products. The parties also engaged in the creation of enterprises for the development and commercialization of biotechnology. The Rosselkhoznadzor has included 25 Iranian companies in the register of suppliers of agricultural products.

Russia counts on preferences in Iran

The projects in Iran will be distributed mainly by competitive tender, but Russia hopes for preference, said Novak. “Maybe there will be some preferences to be issued, if interesting will be offered preferential terms of financing” – hopes the Minister.

The most convincing evidence of the seriousness of the intentions of the parties for the development of cooperation was the statement by the President’s press Secretary Dmitry Peskov, on the possible elaboration of Vladimir Putin’s visit to Tehran to participate in the Forum of gas exporting countries, which will be held on November 23. “Such a forum will be held in Tehran. The President of Russia has an invitation to this forum. The issue is to be reconsidered,” – he said.

However earlier the President of Bolivia, Evo Morales said that the Russian side offered to negotiate with Putin on the sidelines of the forum on 24 November. The leader of Bolivia said that he would like to discuss energy issues with his Russian counterpart.