France's Total says to ditch Iran gas project if no sanctions waiver

Cornelia Mascio
Mag 16, 2018

French oil major Total has halted plans to help develop Iran's giant South Pars gas field as it seeks to clarify whether the investment can avoid falling foul of returning USA sanctions on Tehran, the oil company said Wednesday.

Trump's decision to withdraw from the 2015 nuclear deal with Iran risks exposing European countries that have since invested in Iran to renewed United States sanctions, after "wind-down" periods of three to six months expire.

The Phase 11 contract will automatically go to Total's consortium partner China National Petroleum Corporation (CNPC) and local player Petropars if the French player does pull out, Iranian officials have previously said.

The Palestinian Authority's main daily newspaper launched a vitriolic attack on the United States this week, following the opening on Monday of.

In an unintended twist, U.S. President Donald Trump's decision to threaten European companies that continue to invest in Iran may open the door to Chinese rivals.

TOT "will not be in a position to continue the SP11 project and will have to unwind all related operations" before November 4 unless it receives a waiver from the US protecting it from sanctions.

SP11 is a gas development project dedicated to the supply of domestic gas to the domestic Iranian market and for which Total has voluntarily implemented an IRGC-free policy for all contractors participating in the project, thereby contributing to the worldwide policy to restrain the field of influence of the IRGC.

The French company said it had so far spent less than 40 million euros ($47 million) on the South Pars project, and that pulling out of it would not impact the company's general production growth targets.

Total said any waiver would need to include protection from secondary sanctions that Washington might impose on companies that continue to do business with Iran. Russian Federation has also said it remains committed to the deal.

A gas flare on an Iranian oil production platform.

"The fines are in the multibillions these days so it's just not worth the risk for a small piece of business and maybe pleasing a (European) government". Joe Kaeser, the CEO of Germany's Siemens, told CNN his company would not be able to do any new business with Tehran.

In a deal signed in late 2016, Total agreed to operate the South Pars project with a stake of 50.1%.

Altre relazioniGrafFiotech

Discuti questo articolo

Segui i nostri GIORNALE