Total confirms target of concluding Iran gas deal before summer

Sunday, May 28, 2017


French oil major Total still plans to conclude the Iran South Pars gas deal before summer, its CEO Patrick Pouyanne told journalists on the sidelines of the company's annual general meeting on Friday.

Pouyanne said the signing of US sanctions waivers, among other hurdles, cleared the path for the deal to be signed, Reuters reported.

Pouyanne added that he had met Iran's Oil Minister Bijan Namdar Zanganeh in Vienna on the sidelines of the OPEC meeting.

Total announced in March that it is seeking a 50-percent stake in a $4-billion project in Iran's giant South Pars Gas Field.

Total signed a preliminary deal for the South Pars project last year, becoming the first Western oil major to sign an energy agreement after the European Union and the United States eased sanctions as part of a pact to curb Iran's nuclear program.

Total said that in the South Pars 11 project would require investment of about $4 billion, with the French firm financing 50.1 percent with equity contributions and payments in non-US currency.

If finalized, Total would operate the project with a 50.1 percent stake, China's CNPC would own 30 percent through one of its subsidiaries and Iran's Petropars would have 19.9 percent.

Total had not earlier given details about the value of the project or indicated the breakdown of ownership.

South Pars, a part of the Persian Gulf reserves, is one of the biggest gas fields in the world but its development has been hobbled by years of Western sanctions.

The South Pars project is expected to have a production capacity of 370,000 barrels of oil equivalent per day and the gas would be fed to the Iranian grid. It would require two offshore platforms and 30 wells.

Total said in its announcement that it discussed other projects with Iranian officials in 2016 and carried out technical reviews, including for investment in a 10-million-ton-per-year liquefied natural gas (LNG) plant at Tombak on the Persian Gulf coast.

In February, sources said Total was in talks to buy a stake in the partly-built LNG plant at the port.

The French firm also said in its filing that it discussed plans to invest in the South Azadegan Oilfield.

Total said it resumed trading with Iran in February 2016, and bought about 50 million barrels of crude for about $1.9 billion last year — most of it to supply its refineries.

It also purchased 11 million barrels of petroleum products for $394 million, generating net profit of $2.8 million.

The company further said it was selected along with other companies to consult on a potential oil and gas pipeline between Iran and Oman.


*​Source: Iran-Daily



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