In the coming weeks, the State Department will provide President Obama with recommendations on how to implement Washington's tough new sanctions on Iran. The law imposes severe financial penalties on Tehran in hopes of preventing it from acquiring a nuclear weapon, but it could also have an outsized impact on Houston.
As it turns out, many multinational companies that do business in Iran also have offices and employees right here in Space City. If Washington chooses to enforce the sanctions it has on the books, it could mean lost business for Texas. But officials in Houston and Austin have a unique opportunity to confront these companies behind closed doors and persuade them to abandon their business in Iran rather than risk running afoul of Washington.
Many energy companies and affiliates do business in both the U.S. and Iran, but 10 are especially notable.
According to its website, the German company Aker Solutions has three offices in Houston. Its subsidiary, Aker Wirth, has construction projects in Iran, including a water tunnel in Ghomroud. As the pictures on Aker's Iranian website show, the Islamic Revolutionary Guard Corps has posted its insignia at the entrance to that project, indicating its involvement. Washington and European capitals have marked the IRGC for sanctions on the basis of its involvement in Iran's nuclear and ballistic missile programs, and its ongoing efforts to crush the country's democratic opposition.
Then there's the Russian firm Gazprom, which produces oil in Iran. Industry publications report that it is in discussions to supply gasoline to Iran in open defiance of U.N. sanctions. Its wholly owned subsidiary, Gazprom Marketing & Trading, has offices in Houston.
In our own hemisphere, the Brazilian company Petrobras recently concluded several major energy projects in Iran, including drilling operations in the Caspian Sea and the Tusan gas block in the Persian Gulf. Petrobras has elected to keep its doors open in the Islamic Republic, and it also has an office in Houston.
The Venezuela-owned PDVSA, which owns the Houston-based energy giant Citgo, has multiple energy deals in Iran.
East Asian companies have energy deals in Iran, too. The Japanese firm Inpex is currently developing Iran's Azadegan oil field, and has announced that it has no plans to halt these operations, even after the U.N., U.S. and European Union have all passed new sanctions on Iran. The company's American subsidiary, Teikoku Oil Company Ltd., is based in Houston.
The South Korean company Daelim has three offices in Iran and one in Houston, according to its website. It has reportedly won several contracts to help develop Iran's natural gas reserves and upgrade the country's oil refineries.
European countries supply a lot of the technology and support Iran needs for its energy sector. Dutch company LyondellBasell supplies technology to petrochemical plants in Iran, and has both offices and a refinery in Houston.
Danish firm Haldor Topsoe has worked on several refinery projects in Iran. It also provides licensed technology and engineering assistance to Iran. The company's subsidiary, Haldor Topsoe Inc., is based in Houston.
Down under, the Australian firm WorleyParsons provides engineering for energy projects in Iran, and maintains an office in Houston.
And Sasol, a South African firm, is active in Iran's petrochemical production, and has also purchased crude oil from Iran for its refineries. The company's North American subsidiary, Sasol North America, has offices in Houston.
These companies are among the most active in Iran, and they all have footholds in Houston.
It's obvious that energy companies are a major source of revenue for Texas. It's equally obvious that state legislators have no desire to drive away business, but they must also recognize that they cannot welcome the Iranian regime's financial enablers.
In the end, federal sanctions may ultimately bar some of these companies from operating in the United States, taking a toll on Houston's businesses. But all politics are local, and before that happens, Texans can engage these companies privately, in an attempt to convince them to pull out of Iran.
If successful, such an initiative could help Houston's many international energy companies stay in good standing with Washington and bolster Texans' reputation of fighting for America's interests, at home and abroad.
Schanzer, a former U.S. Treasury intelligence analyst, is vice president at the Foundation for Defense of Democracies.