Saipem signs Iran refinery deal

In the wake of a visit to Italy by Iranian President Hassan Rouhani on Monday, Saipem confirmed a deal to revamp two refineries in Iran, amid rumours of a pipeline deal.

Italian services firm Saipem has inked a memorandum of understanding with Parsian Oil & Gas Development Company (POGDC) for major hydrocarbons projects in Iran, the company announced Monday.

The agreement with POGDC, the largest non-government oil and gas company in Iran, will cover the modernisation of the Tabriz and Pars Shiraz refineries. Saipem was involved in the initial construction of both refineries in the 1970s. An unidentified source also reported to Reuters that the Italian firm would also likely announce its involvement in a 2,000-km Iranian pipeline construction project valued between USD 4 billion and USD 5 billion in the near future. No financial details surrounding the agreement have been released by the involved parties.

The deal was signed in the presence of both Italian Prime Minister Matteo Renzi and Iranian President Hassan Rouhani, who flew to Italy Monday for the ceremony.

The Saipem-POGDC agreement comes on the heels of a tumultuous trading week marked by shifting global economics as sanctions against Iran are lifted, and as the Italian company launches a 22-1 rights issue with the goal of raising EUR 3.5 billion.