From: <a href="http://www.aftenposten.no/spesial/wikileaksdokumenter/article3966838.ece">Aftenposten</a><br>

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2008-08-01 12:48
C O N F I D E N T I A L OSLO 000428
SIPDIS
EUR/NB (MMCDOWELL), DEPARTMENT OF ENERGY (EROSSI, TSARKUS, JGIOVE),
INR/I (SMCCORMICK), EEB/ESC (SGALLOGLY)
E.O. 12958:
DECL: 08/01/2018
TAGS: ECON, ENRG, EPET, PGOV, SENV, IR, NO
SUBJECT: NORWAY: STATOILHYDRO AND IRAN
REF: A. OSLO 387 B. 8/1/08 TO EMAIL TO MMCDOWELL
Classified By: DCM Kevin M. Johnson, Reasons 1.4 (b) and (d)

1. (C)
Summary. Following increasing USG pressure and Total´s recent
public decision to pursue no Iranian South Pars energy
projects, StatoilHydro chief executive Helge Lund announced
his company would not pursue any new Iranian projects. The
executive telephoned the Ambassador, emphasizing Lund´s
decision to make this position known publicly. Another
StatoilHydro executive stressed the importance of Lund´s
statements, identifying them as a clear signal to where the
company was heading--namely, out of Iran. End Summary.

Lund to FT: "No New Investments"
-------------------------------

2. (C)
A July 31 Financial Times interview with StatoilHydro´s chief
executive Helge Lund included the Norwegian energy giant´s
commitment to no new Iranian investments. The FT reported Lund
pledging StatoilHydro "will not make any new investments in
Iran at this time." Referring to discussions with the U.S. and
authorities in both Norway and the E.U., Lund stated that the
company would soon reduce involvement in the South Pars gas
project, transferring control to Iran´s national oil company
by early 2009. The interview concludes with reference that
StatoilHydro, paid as a service contractor, will be involved
in South Pars until it recoups its costs, possibly in four
years. (Note StatoilHydro, the world´s ninth largest energy
company, is majority government-owned. The company invested
over $500 million in the South Pars project).

Norwegian Press Conference: We Made Our Own Decision 
----------------------------------------------------

3. (U)
On August 1 Lund held a press conference reflecting the
company´s now public decision to not seek new Iranian projects
(Ref Email). Several questions emerged concerning the dialogue
with the USG. Lund denied that USG discussions determined the
discussion, and said ultimately the commercial decision to
halt new Iranian projects rested with the company. The chief
executive reiterated that StatoilHydro would extricate itself
from South Pars following investment cost recapture.

4. (C)
Econ Officer spoke with a senior StatoilHydro executive
following the press conference. The executive stressed the
import of Lund´s statement, saying it was very clear that the
company would not make any new Iranian investments. He
reaffirmed StatoilHydro will pull out of South Pars after
investment costs are returned. When questioned about the
implications of Lund´s statement on StatoilHydro´s Anaran
project, the executive was unclear. He reiterated that the
company would not withdraw from its Anaran obligations, but
yet not make any new project investments. He stressed that the
Iranian government will "not make it easy" for the company to
withdraw from Anaran, but the company would "refrain" from new
business. The executive could not clarify the scope of its
existing Anaran commitments.

Ambassador´s Call with Lund 
---------------------------------

5. (C)
Immediately after the press conference, the StatoilHydro chief
executive called the Ambassador, emphasizing that he was being
extremely proactive with the media in an effort to get out the
message that StatoilHydro will have no new Iranian
investments. Lund noted that he felt other companies made
Iranian investments, but that his company faced "bad timing."
He further stated that StatoilHydro had been, and would
continue to be, extremely open with the USG as to the
company´s Iranian plans. The Ambassador raised the ongoing
dialogue he and his staff have had with Lund and StatoilHydro
over the years, which stressed the negatives of any Iranian
involvement. While the Ambassador welcomed StatoilHydro´s
public decision, he further cautioned Lund as to the risks of
Iranian investments.

Risk Management?
----------------

6. (C)
Comment. Lund´s public statements and discussion with the
Ambassador, particularly following U/S Burn´s recent
Congressional testimony and the continued company dialogue
with State officials (Reftel), reflects growing StatoilHydro
concerns over possible Iran Sanctions Act implications. The
company has made it clear that it wants to recoup costs, and
get out of Iran. With expansion ambitions in its sizable Gulf
of Mexico and Chukchi Sea projects, the company does not want
those projects jeopardized by possible ISA sanctions.
Nevertheless, the company should clarify when it will pull out
of Anaran. End Comment.

WHITNEY
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