Japan turns on the sanctions squeeze on Iran

Tokyo: Japan's biggest energy explorer, Inpex Corp, said Friday it would withdraw from Iran's Azadegan oil field project, in a move aimed at pre-empting any US move to put it on a sanctions list. Iran is under a fresh round of sanctions from the United Nations under US sponsored resolutions for refusing to stop enriching uranium to possible weapons-grade capability.

Iran claims the programme is for peaceful purposes.

"Inpex Corp. has reached an agreement with Iran's state oil company that its subsidiary will withdraw from the Azadegan oilfield development project," the Japanese government-backed company said in a statement. It had a 10 per cent stake in the project.

The move follows up on a 3 September decision by Japan to suspend new oil and gas investments in Iran and to freeze the assets of 88 organizations and 24 individuals.

''If we had kept the stake in the project and became a target of US sanctions, we may not be able to use US financial institutions,'' spokesman Kazuhiko Itano told reporters in Tokyo. ''Our understanding is that we don't have to pay a penalty to Iran.''

The current round of sanctions on Iran are the fourth such set by the UN.