S. Korea to seek exemption from Iran oil sanctions

SEOUL, January 6, 2012 (AFP) - South Korea will seek an exemption from new US sanctions that will further restrict Iran's crucial crude oil exports, a senior Seoul official said Friday.

"This is a matter of serious concern for us," the official told AFP on condition of anonymity, noting that Iran is a key supplier of crude to South Korea.

In the first 11 months to November last year, South Korea imported 8.16 million barrels of crude from Iran, amounting to 9.6 percent of its total crude imports.

"We cannot afford to lose this important source of oil and we have to get an exemption from the implementation of the sanctions," the official said.

The new US sanctions are directed at Iran's central bank, which processes most of its oil sales. They will effectively make foreign firms choose between doing business with the Islamic republic or the United States.

But the bill gives President Barack Obama some wiggle room, allowing him to grant 120-day waivers for institutions in a country that significantly cuts its other transactions with Iran.

"Through a significant reduction in transactions with Iran, we want to be granted an exemption. We need talks with the United States to decide what may constitute a significant reduction," the official said.

He said talks would start after the United States and other countries discuss coordination over the new sanctions.

Highly industrialised South Korea, which imports all its crude, is a close ally of the United States, which bases 28,500 troops in the country.

Seoul last month added more than 100 names to a financial blacklist of Iranian firms and individuals, joining a fresh multinational effort to press Iran to scrap its suspected nuclear weapons programme.

But it did not announce a ban on imports of petrochemicals or crude oil.

"We are working toward minimising the negative impacts that (the US sanctions against Iran) could have on our economy," foreign ministry spokesman Cho Byung-Jae said Tuesday.

"We are in talks with the United States regarding the issue."

Kurt Campbell, the US State Department's top Asia official, Thursday admitted that the bill was a source of some concern in South Korea.

"This new legislative provision creates some anxieties in South Korea. We understand this and we're committed to close coordination, cooperation with South Korea going forward on this matter," he told journalists.