200 Billion Cubic Meters in Gas Reserves Hang on 'Friendship'
With Dorra field's 200 billion cubic meters of gas reserves hanging in the maritime balance, Kuwait's Foreign Minister Sheikh Mohammed Sabah al-Salem al-Sabah referred to Iran as a "friend" at a news conference on Jan. 16, frustrating efforts by the visiting American president to build alliances against Iran.
"I can only speak on my government's behalf," said Sabah. "My country knows who is our friend and who is our enemy, and Iran is our friend."
Sabah came to Tehran to put an end to the Kuwait-Iran feud regarding their maritime boundary. Sabah's Iranian counterpart Manouchehr Mottaki revealed that while nothing had been finalized regarding the boundary, the two parties did agree to undergo "a more exhaustive study" to reach an agreement on the continental shelf.
Iran and Kuwait granted concessions from the north of the Dorra gas field to the Anglo-Iranian Petroleum Co. in 1960. Today, that company is part of BP and Royal Dutch Shell.
Kuwait's efforts to align itself with Iran comes while the energy-rich country takes steps to distance itself from the U.S. dollar.
In May 2007, Kuwait's central bank governor moved to contain his country's rapidly rising inflation by backing away from the U.S. dollar.
In a statement given to the state news agency KUNA, Sabah said, "The massive decline in the dollar's exchange rate against main currencies ... has contributed to the increase in local inflation rates and this step is part of the central bank's efforts to curb inflationary pressure."
Kuwait is just the most recent country in a growing line of proposed alliances for Iranian oil projects.
"Iran is one of the few countries which is today inviting companies to come and invest in its oil sector," says Bijan Khajepour, chairman and strategic consultant at Tehran-based Atieh Bahar Consulting, an independent business think-tank specializing on Iranian affairs.
In the last year, companies including China Petroleum & Chemical Corp., or Sinopec, Norway's Statoil ASA, Royal Dutch Shell PLC, Italy's Eni SpA, Total SA, Russia's Lukoil and Austria's OMV AG vied for the opportunity to develop 17 oil blocks.
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