Serica, BP get temporary U.S. OK to work on partly Iranian owned UK project

LONDON (Reuters) - Serica Energy said on Monday that the U.S. Treasury had given temporary approval for certain U.S. businesses to work on a British North Sea oil and gas field owned in part by Iran, which is targeted by U.S. sanctions.

London-based BP last year agreed to sell to North Sea oil producer Serica three fields including the Rhum field of which a subsidiary of Iran’s national oil company owns half.

“Serica Energy plc announces that it has received notification from BP that the U.S. Office of Foreign Assets Control (“OFAC”) has issued a new license relating to the Rhum Field,” it said in a statement.

“The license authorizes the provision of essential goods, services and support by certain U.S. persons and businesses to the Rhum field until 4 November 2018, replacing an existing authorization which expired on 30 September,” Serica said.

“Discussions continue with OFAC regarding the conditions under which authorization may be given for the provision of goods, services and support to allow Rhum production to continue beyond 4 November.”

The $400 million deal, which also covers the Bruce and Keith fields, is yet to complete pending a final U.S. decision on whether U.S. companies can be involved in running Rhum.

The BP transaction would increase Serica’s production sevenfold to around 21,000 barrels of oil equivalent per day, of which around 85 percent is gas.

Rhum was shut down for most of the first half of the decade due to Western sanctions on Tehran. It resumed normal operations in 2016 following a nuclear deal between Iran and the world’s top powers.

That accord is in danger of unraveling after U.S. President Donald Trump decided to impose fresh sanctions on Iran.

Reporting by Shadia Nasralla; editing by Jason Neely