Iran has long struggled to secure funding to develop its oil and gas resources as several western oil giants have pulled out of the country following the tightening of international sanctions. The troubles are only worsening, with even Asian oil companies finding it difficult to raise funds for its South Pars development.

It has been reported that India’s state-owned Oil and Natural Gas Corporation (ONGC) has signaled to difficulties in raising and transferring funding for the Phase 12 development of the massive offshore South Pars field. ONGC's overseas subsidiary ONGC Videsh (OVL) has reportedly found that banks have proven unwilling to fund OVL's acquisition of a 40 percent stake in the project.

While it has been clear for most Western countries for a few years that they will not be able to commit financially in Iran given the increasing sanctions against the country, it has gradually also become very clear also to Asian companies as well, said IHS Global Insight's senior Middle East energy analyst Samuel Ciszuk in a note.

It is not that it is a closed chapter. It is very much on our table but we have to see to the funding issue, Reuters quoted a company source as saying last week. The source said it was not easy to find money without violating sanctions.

The Reuters source said bypassing the Indian and international financial industry was ruled out while saying that the project cannot be funded through ONGC's balance sheet. We need to have banks involved for transferring and to partly fund our share of development costs to Iran which is done in dollars.

Ciszuk says the Asian Investor Owned companies (IOC) and national oil firms could try to string Iran out as long as possible, hoping that the situation might change somewhat in the meantime but Iran will be short of options if these companies also turn back.

Iran lost its patience with Western companies after two to three years of procrastination, a time-frame which might be shorter this time, but if Iran does expel Asian IOCs and NOCs, there will be absolutely nowhere else to turn, with at least some engineering studies now being delivered almost pro bono.