MILAN: Italy's oil and gas major Eni is handing over operator ship of Darkhovin oilfield in Iran to local partners to avoid US sanctions for doing business with Iran, Eni said in a document for US authorities. The United States and its allies suspect Iran wants to develop nuclear weapons, while Tehran says it needs nuclear energy to meet power demand. "Our activities in Iran could lead to sanctions under relevant US legislation," Eni, which has oil and gas operations in Iran, said in an annual report filed with the US Securities and Exchange Commission. Eni said no sanctions had been imposed to date on its activities in Iran, but added risks could arise from a new bill to extend the reach of US sanctions passed by the US House of Representatives. Eni, which has been present in Iran since 1957, said its current activities there were primarily limited to carrying out residual activities relating to certain buy-back contracts it entered into in 2000 and 2001. "Specifically, activities are progressing to hand over operator ship of the Darquain (Darkhovin) oilfield to the local partners as development activities were concluded at this field in 2009," Eni said. Darkhovin remained the sole activity operated by Eni in Iran, it said. Eni said it was being reimbursed for the past investments in another project which it did not name and which it handed over in past years. Eni said its output in Iran was 35,000 barrels of oil equivalent per day in 2009, or about 2 percent of the group's total production, and it did not believe its activities in Iran have a material impact on the group's results. It said it was aware that some US institutional investors, such as pension funds, could decide to divest from companies doing business in Iran and such moves could hit Eni's shares and securities. Eni had capital expenditures of over $20 million a year in Iran in the last 10 years and its management may decide to invest amounts in excess of $20 million a year there in the future, Eni said referring to the US Iran Sanctions Act. Under the Act, sanctions may be imposed on any person found to have knowingly invested $20 million or more a year, contributing directly and significantly to the enhancement of Iran's ability to develop its hydrocarbons resources, it said.
