Iran's Navy Attacks and Boards Romanian Rig in Gulf

Aug. 22 (Bloomberg) -- Iran attacked and seized control of a Romanian oil rig working in its Persian Gulf waters this morning one week after the Iranian government accused the European drilling company of ``hijacking'' another rig.

An Iranian naval vessel fired on the rig owned by Romania's Grup Servicii Petroliere (GSP) in the Salman field and took control of its radio room at about 7:00 a.m. local time, Lulu Tabanesku, Grup's representative in the United Arab Emirates said in a phone interview from Dubai today.

``The Iranians fired at the rig's crane with machine guns,'' Tabanesku said. ``They are in control now and we can't contact the rig.'' The Romanian company has 26 workers on the platform, he said.

Iran, which holds the world's second-largest oil and gas reserves, is due to respond today to a European Union-led offer of incentives aimed at persuading it to halt uranium enrichment activities that are crucial to its nuclear program.

Neither the press office of Iran's oil ministry nor the one of Iran's revolutionary guards could be reached for comment when called. Today is a national holiday in Iran.

Crude oil for September was at $72.56 a barrel, up 11 cents, on the New York Mercantile Exchange at 12:06 p.m. in London. The contract expires today. The more-active October contract was up 7 cents at $73.37 a barrel.

Straits of Hormuz

Iran urged the United Arab Emirates last week to help it return another oil rig owned and operated by the Romanian company in the same waters close to the Straits of Hormuz, through which 20 percent of the world's daily oil supply moves on tankers.

Grup said it recovered its rig last week because of a contractual dispute with its Iranian client, Oriental Oil Kish.

Iranian President Mahmoud Ahmadinejad suspended Oriental Oil's activities in 2005 on alleged corruption activity and ties to Halliburton Co. of the U.S. The U.A.E.-registered drilling company had signed a preliminary contract with Halliburton after winning an estimated $310 million contract to develop phases 9 and 10 of Iran's offshore South Pars gas reservoir.

Mircea Geoana, the head of the Social Democratic Party, the main opposition party in Romania, called on the government to ``undertake all diplomatic measures necessary'' to persuade the Iranians to release the rig.

He also called on President Traian Basescu in a news conference broadcast on Realitatea television to invite all political party heads to the presidential palace to ``discuss what Romania's reaction will be to this provocation.''.

To contact the reporter on this story: Andy Critchlow in Dubai at at [email protected]