A US congressional committee is to look at a gasfield development deal between the China National Offshore Oil Corp (CNOOC) and Iran to determine if US sanctions are called for against the Chinese company, Congressman Tom Lantos has said.

Iran and CNOOC signed a preliminary 16 billion US deal to develop a giant natural gas field earlier this month. The deal is aimed at developing Iran’s northern Pars gas field and building plants to produce liquefied natural gas, with each party taking 50 per cent of the produced LNG.

However Congressman Lantos, a California Democrat and chairman-elect of the House International Relations Committee, said that when Congress convenes next week, his committee “will closely examine” the deal.

“Specifically, we will examine whether this agreement activates United States law requiring sanctions against companies involved in Iranian energy development, as is potentially the case here,” Lantos said.

“Congress recently extended and strengthened the Iran Sanctions Act, as part of legislation which I co-sponsored, and China needs to be warned of the serious penalties it may incur if it pursues implementation of this agreement,” he added.

So American sanctions against a Chinese company investing in Iran. Could be trouble ahead…