South Korea’s Daelim Industrial says its KRW2.233 trillion ($2.086bn) contract to upgrade Iran’s Isfahan Refinery has been terminated.

The contract with Esfahan Oil Refining Company (EORC) was cancelled following the Washington’s decision to reintroduce economic sanctions on Iran.

On 8 May, President Donald Trump announced that the US would withdraw from the 2015 accord to curb Iran’s nuclear programme and reinstate sanctions.

The contract was signed in December 2016 with Esfahan Oil Refining Company (EORC) and involved the design, procurement, construction and financing of the project.

The scheme plans to add new facilities that will be used to increase the production of high value-added products.

The Isfahan refinery first started production in 1979 and has a current capacity of 375,000 b/d.

Daelim is the latest company to say it will leave Iran due to sanctions. In May, French oil major Total said it will exit the South Pars Phase 11 project unless it is given a waiver by the US authorities exempting it from sanctions.

While some companies leave the Iranian market, others are filling the void.

In May, Chinese state-owned oil company Sinopec stepped up talks over a $3bn deal to develop Iranian energy assets that Royal Dutch Shell was previously negotiating for.

Over 2016 and 2017, Shell was negotiating to develop a range of oil and gas fields in Iran, including the South Azadegan and Yadavaran oil fields and the Kish gas field.

Ultimately, Shell decided the sanctions risk was too high and announced in March that it had decided to abandon plans to develop hydrocarbons in Iran.