On Air Now

Upcoming Shows

Program Schedule »

Listen

Listen Live Now » 590 AM Kalamazoo, MI

Weather

Current Conditions(Kalamazoo,MI 49001)

More Weather »
72° Feels Like: 72°
Wind: WSW 15 mph Past 24 hrs - Precip: 0”
Current Radar for Zip

Today

Scattered Thunderstorms 82°

Tonight

Scattered Thunderstorms 67°

Tomorrow

Partly Cloudy 79°

Alerts

Big Oil sits out lobbying on Iran as Congress stands firm

The U.S. Capitol dome is pictured in the pre-dawn darkness in this general view taken in Washington, October 18, 2013. REUTERS/Jonathan Erns
The U.S. Capitol dome is pictured in the pre-dawn darkness in this general view taken in Washington, October 18, 2013. REUTERS/Jonathan Erns

By Timothy Gardner and Andy Sullivan

WASHINGTON (Reuters) - As debate rises in Washington over the first thaw in relations between Iran and the United States in decades, powerful oil companies are opting for an unusual tactic: silence.

Oil companies such as Exxon Mobil Corp and ConocoPhillips could earn huge profits if the United States loosened economic sanctions on Iran, allowing access to its oil and natural gas fields, some of the world's largest and least costly to produce.

But through September, at least, U.S. energy companies have largely opted to stand back even as Congress considers whether to further limit new oil exports from the Islamic republic.

It is an unusual tack for an industry known for its strong Capitol Hill presence on every issue from taxes to pollution rules to international trade.

But this particular issue may be too hot to touch.

"You are unlikely to flip any lawmaker, but you could offend them," said one lobbyist familiar with sanctions issues, who spoke on condition of anonymity to avoid being seen as speaking for clients. He said his company had received no client requests this year to lobby on Iran sanctions.

The oil and gas industry spent $105 million on lobbying in the first nine months of this year, behind only the insurance and pharmaceutical industries, according to the Center for Responsive Politics, a Washington watchdog group. Companies in the sector, and their employees, also donated a total of $20.5 million to candidates in last year's elections, ranking ninth overall.

It is uncertain whether the six-month deal with Iran struck last month in Geneva will lead to comprehensive restrictions on its nuclear capabilities, which could bring a full rollback of sanctions. Under the interim deal, Iran will limit uranium enrichment in return for limited access to funds frozen by U.S. law.

The June election of moderate President Hassan Rouhani offered a clear sign that 2013 could be the best year for relations between Washington and Tehran since Iran's 1979 revolution.

Yet the U.S. Congress has been firm in its backing of further action against Iran. The House of Representatives voted 400-20 in July to choke funding to Iran's disputed nuclear program by slashing its oil exports further than sanctions enacted in 2010.

The Senate also widely supports being tough on Iran, though President Barack Obama has pushed it to delay introduction of its version of the bill to give the Geneva agreement a chance.

DEAF EARS

For its part, Iran's oil ministry is hopeful a full deal could one day spur new investment by U.S. energy companies. Oil Minister Bijan Zanganeh this month named seven Western energy companies it wants back to develop reservoirs if sanctions are lifted, including Exxon and Conoco.

Exxon spokesman Alan Jeffers said that his company always looks for development opportunities, but that current U.S. laws prevent work in Iran.

A Conoco spokesman said his company is not engaged in business discussions with Iran.

Both companies have not lobbied Congress this year on Iran sanctions, records show. Neither has U.S.-based companies Chevron Corp or Halliburton Co.

All four companies lobbied Congress in 2010 on the initial sanctions bill that targeted the OPEC member's oil exports.

Conoco lobbied that year, the spokesman said, as part of a coalition called USA Engage. The coalition was concerned about the impact of sanctions on joint venture projects in foreign countries.

"The 2013 legislation did not appear to have this impact, and no lobbying activity was required," the Conoco spokesman said.

The other three U.S. companies declined to comment.

Congressional aides agreed oil companies would be wasting their time if they attempted to persuade lawmakers to turn back existing sanctions or prevent enactment of new ones.

The effort "would likely fall on deaf ears at a minimum and at worst create serious political repercussions" if oil companies were seen as undermining the resolve by the countries that reached the interim agreement with Iran, the United States, Britain, Russia, China, France and Germany, one Democratic House aide said on condition of anonymity.

The companies that have lobbied Congress this year have largely been U.S. divisions of larger international oil companies, such as BP America, part of London-based BP Plc and Shell Oil Co, the U.S. unit of Royal Dutch Shell Plc.

BP lobbied Congress between April and September of this year on the House Iran bill, while Shell weighed in on "general issues related to Iran" between January and March, records show.

"It is not unusual for BP to discuss proposed new legislation with lawmakers in order to understand its purpose and scope so that, among other things, we can remain compliant in the event it is enacted," said BP spokesman Scott Dean.

Shell did not respond to questions.

The American Petroleum Institute, the main oil industry trade association, lobbied on a provision in the bill that threatened U.S. shipping lanes, but not on the sanctions themselves, an oil industry expert said. The trade group declined to comment.

(Additional reporting by Patricia Zengerle; Editing by Marilyn Thompson, Martin Howell and Lisa Shumaker)

Comments