Foreign contractors building power plants will be allowed to export Iran’s electricity, deputy energy minister for planning and economic affairs said on Tuesday, after holding a new round of trade talks with major South Korean companies and a bank in Tehran.
Alireza Daemi met with senior South Korean officials on Tuesday, including representatives from Hyundai and the Export-Import Bank of Korea, commonly known as the Korea Eximbank, Mehr News Agency reported.
According to Korean officials, Eximbank is planning to enter into joint ventures with Iranian firms in various economic sectors and finance their activities as a sponsor.
Daemi said the government has agreed to allow foreign firms to undertake part of Iran’s electricity exports to neighbors such as Turkmenistan and Tajikistan, as a measure to help fast-track the financing and construction of power plants nationwide on the prospect of lifting the sanctions against the Islamic Republic.
Iran and six world powers reached a landmark deal on July 14 in Vienna that would limit the Persian Gulf country’s nuclear program in return for removing sanctions on its energy and financial industries.
Tehran’s incentive package for foreign energy investors includes guaranteed purchase of electricity from power plants built by foreign contractors and permission to export electricity.
Daemi said joint energy projects with international companies are on the cards, adding that this would be “a good start to expand energy ties with Korean companies.”
“Iranian companies are developing around 80 major projects overseas,” he added.
Daemi referred to South Korea’s advanced automotive industry and called for an equally strong presence of Korean firms in the Iranian energy sector.
South Korea’s auto industry is the fifth-largest in the world measured by automobile production and the fifth-largest by automobile export volume.
Ongoing Trade Talks
A delegation of South Korean government officials and businessmen explored investment opportunities in a conference in Tehran on Sunday, which was attended by Seoul’s Ambassador to Iran Woong Yeob Song and representatives of giant corporations including LG, Samsung and Hyundai.
In September, Korea’s electricity giant KEPCO expressed willingness to build a 1,000-megawatt power plant in Iran in a meeting with officials from the Chabahar Free Trade and Industrial Zone Organization.
In a separate meeting last month, Daemi announced a preliminary agreement had been reached with Hyundai to establish a joint venture for investment in energy projects in Iran and its neighboring countries.
Hyundai, widely known as a leading international carmaker, maintains extensive operations in the power sector, including power plant construction and shipbuilding.
Daemi quoted Hyundai officials as saying that the Korean giant “faces no limits” for investment in Iran’s electricity industry and can finance energy projects via foreign banks.
European Interest
Negotiations with Koreans come as European countries are seeking a fortune in the lucrative Iranian energy market ahead of their Asian rivals.
On Monday, Daemi met with a high-ranking delegation from the northwestern German state of Lower Saxony, hoping to take advantage of German expertise in power generation from renewable energy sources as well as electricity and water consumption management.
In a separate meeting on Monday, a high-ranking UK delegation discussed energy ties with Iranian officials, including cooperation in the upstream oil and gas sector, research and development, marketing, exports and investment as well as in mining, industrial and trade sectors.
