WASHINGTON May 12 The U.S. government has
obligated almost $880 million in recent years to seven foreign
firms that had commercial activity in Iran's energy sector, the
U.S. Government Accountability Office said on Wednesday.
U.S. lawmakers upset by what they see as companies
continuing to help Iran's economy, which they say indirectly
aids its nuclear program, held a hearing in the Senate Homeland
Security and Governmental Affairs Committee on Wednesday.
Foreign companies that invest in Iran's energy sector can
be sanctioned under U.S. law. Washington suspects Iran's
nuclear program is aimed at making a bomb, but Tehran says it
is for energy needs.
The GAO statement was a follow-on to a report it did in
March, in which it identified 41 foreign firms that have
commercial activity in Iran's energy sector. The new report
identified which of those firms had U.S. government contracts
from fiscal years 2005-2009.
Almost 90 percent of the U.S. funds in these contracts were
obligated for purchases of fuel and petroleum products
overseas, Joseph Christoff, director of International Affairs
and Trade at the GAO, said in testimony prepared for a Senate
Republican Senator Susan Collins said she was "deeply
troubled" that the U.S. government still does business with
companies that are "at least indirectly, aiding and abetting
Iran's nuclear program by investing in the Iranian economy."
Collins said that current law needed to be enforced; but in
light of the new information, Congress also needed to
strengthen its sanctions against Iran.
The seven companies were Repsol (REP.MC) of Spain; Total
(TOTF.PA) of France; Daelim Industrial Company of South Korea;
ENI (ENI.MI) of Italy; PTT Exploration and Production of
Thailand; Hyundai Heavy Industries of South Korea; and GS
Engineering and Construction of South Korea.
The Iran Sanctions Act allows for U.S. sanctions on foreign
firms that invest more than $20 million in Iran's energy sector
over a 12-month period. But no sanctions have been imposed
under this law.
"We did not attempt to determine whether the activities of
the 41 firms we identified meet the legal criteria for an
investment under the Iran Sanctions Act," Christoff said in his
statement to the Senate Homeland Security and Governmental
(Editing by Timothy Gardner and Vicki Allen)