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Tom Lantos, the head of the US House
of Representatives’ top foreign affairs panel, described as "abhorrent"
the US$16 billion deal signed in January between the state-owned National Iranian
Oil Company and Malaysia’s SKS Group.
<P>"That is why today I am sending
a letter to our trade representative, Susan Schwab, requesting that all negotiations
between the United States and Malaysia on a free trade agreement be suspended
until Malaysia renounces this proposed deal," Lantos told a Congressional
hearing.</P><P>The United States and Malaysia, a predominantly Muslim and growing
Southeast Asian economy, are preparing for a fifth and crucial round of negotiations
to frame a free trade agreement before Bush’s powers to strike free trade deals
expire in June.</P><P>In his letter to US Trade Representative Schwab, Lantos
said the Malaysia-Iran deal was a "disturbing development that I believe
requires swift action by the administration."</P><P>The US Congress recently
extended and strengthened the Iran Sanctions Act, requiring sanctions against
companies involved in Iranian energy development "as is potentially the case
here," Lantos said.</P><P>The 25-year deal was to develop the Ferdos and
Golshan offshore gas fields in southeastern Iran and establish liquefied natural
gas (LNG) plants.</P><P>"Since the fundamental purpose of any FTA (free trade
agreement) is to strengthen cooperation consistent with broader US strategic goals,
I believe we have a right to expect the government of Malaysia to join us in condemning
this LNG deal and, more importantly, to make certain that it is nullified before
we proceed with further trade negotiations," Lantos said.</P><P>Malaysia,
he added, stood to benefit greatly from an FTA with the United States, and "it
is important that our trade partners are not engaged, actively or passively, in
undermining our most basic security policies."</P><P>The USTR office said
it was studying Lantos’ request but gave no detailed comment.</P><P>"We have
received the letter and are reviewing it," USTR spokesman Stephen Norton
told AFP.</P><P><B>Possible sanctions</B></P><P>A proposed multi-billion dollar
agreement by oil giants Repsol of Spain and Royal Dutch Shell to help commercialise
Iranian gas deposits could also trigger US sanctions.</P><P>The Iranian news agency
ISNA reported on Sunday that Iran has signed a preliminary agreement with Repsol
and Shell to produce liquefied natural gas from Iran’s South Pars gas field in
a deal worth some US$10 billion.</P><P>State Department spokesman Sean McCormack
said the investment agreement, if confirmed, would likely trigger a US investigation
and possible sanctions under US law.</P><P>The 1996 Iran-Libya Sanctions Act requires
the US president to impose sanctions on companies which invest more than 20 million
dollars in Iran’s energy sector.</P><P>Iran also said recently it would finalise
in February a US$16 billion gas agreement with China’s largest offshore oil producer
CNOOC.</P><P>Beijing is already the second largest buyer of energy products from
Iran, home to the world’s second biggest proven oil reserves after Saudi Arabia,
and the second biggest gas reserves after Russia. – AFP</P>
<P><I>Source: http://www.malaysiakini.com/news/62871</I>
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