October 29, 2018 / 8:05 AM / 20 days ago

South Korea's Hyundai E&C cancels $521 million petrochemicals deal, cites Iran financing failure

FILE PHOTO The Hyundai logo is seen outside a Hyundai car dealer in Golden, Colorado, November 3, 2014. REUTERS/Rick Wilking/File Photo

SEOUL (Reuters) - South Korea’s Hyundai Engineering & Construction said on Monday that it scrapped a 595 billion won ($521 million) deal to build a petrochemicals complex in Iran, saying the Iranian customer’s ability to fund it had been hit by the prospect of U.S. economic sanctions against Tehran.

In a regulatory filing, Hyundai E&C said the consortium it led for the project’s construction cancelled the contract on Sunday.

“The contract was cancelled because financing is not complete, which was a prerequisite for the validity of the contract, as external factors worsened such as economic sanctions against Iran,” Hyundai E&C said in its filing.

From Nov. 4, the United States will re-impose sanctions against Iranian crude oil exports as part of President Donald Trump’s efforts to force Tehran to accede to a more restrictive deal on limiting its nuclear and missile programmes.

($1 = 1,142.4000 won)

Reporting by Ju-min Park and Heekyong Yang; Editing by Kenneth Maxwell

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