US Sanctions Loom, Total (NYSE:TOT) Exits Huge Energy Project in Iran
The French giant Oil & Gas Total (NYSE:TOT) company opted out, but its Chinese partner is reluctant to become the Nat Gas project’s operator.
The Y 2017, $5-B contract for new development at the massive South Pars offshore Nat Gas field was the 1st major gas deal signed with Iran following the Y 2015 nuclear deal.
Iran’s Oil minister said Monday that France’s energy giant Total SA has officially pulled out of Iran after cancelling its $5-B, 20-year agreement to develop the country’s massive South Pars offshore Nat Gas field over renewed US sanctions.
Iran’s parliament’s website ICANA.ir quoted Oil Minister Bijan Zanganeh as saying that since Total 1st announced its decision a while ago, Iran has been in the process of “looking for an alternative” to Total.
There was no immediate comment from TotaI.
Total pulled out of Iran once before in Y 2008, as Western sanctions over its nuclear program began to ramp up.
The 2015 landmark nuclear deal, which curbed the Iranian nuclear enrichment program in return for the lifting of international sanctions marked a rush for Western businesses to access Iran’s largely untapped market of 80-M people.
Most prominently, airplane manufacturers rushed in to replace the country’s dangerously dilapidated civilian airplane fleet.
South Pars is the world’s largest Nat Gas filed and is shared by Iran and Qatar, where it is called North Dome.
Qatar produces more than 590-M cubic meters per day from the shared field and plans to increase production by 10% by Y 2022.
Iran’s total Nat Gas production stands at 750-M cubic meters per day, of which 550-M is consumed domestically.
Iran exports Nat Gas to neighboring Turkey and Iraq, and pipelines to Pakistan and Oman are in the works.
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