Bush Asked to Act Against Sheer Iran Deal

A congressional resolution has been introduced that denounces a project between Canadian oil company Sheer Energy and Iran's national oil company. The congressman that introduced the resolution has urged the Bush administration to impose economic sanctions against the firm.

The $80 million contract signed last week was the first major foreign investment in Iran's energy sector since the September 11 attacks and tests a U.S. law to limit overseas companies from doing business with Iran. Democratic Rep. Tom Lantos of California, who sponsored the congressional resolution, said the deal violates the Iran-Libya Sanctions Act (ILSA) that seeks to punish foreign companies that invest more than $20 million a year in the energy sector of either country. "I am appalled that a Canadian oil company would aid and abet Iran's campaign of international terrorism by cutting a deal with the regime's oil exploration and development arm," said Lantos. "Iran is clearly embarked on a policy of developing weapons of mass destruction with oil profits such as those to be gained through this deal," he said. Lantos' non-binding resolution calls on President George W. Bush to invoke the ILSA sanctions, which among other things would prevent banks from providing financing to Sheer. "We cannot permit greedy multinational corporations to lubricate the machinery of terrorism operating in Iran and elsewhere through such corrupt and inhumane oil deals," Lantos said.

A vote has not been scheduled on the House resolution.

The State Department said last week that the administration would review whether the Sheer deal violated the sanctions law and would take the appropriate action if necessary. Under ILSA, Bush could waive sanctions against Sheer if he determines it would be in the best interests of the United States to do so. Former President Bill Clinton took such a route and chose not to levy sanctions on European and Russian oil companies that invested in Iran.