Total-led group lands first contract in Iran in a decade

Total-led group lands first contract in Iran in a decade

The National Iranian Oil Company (NIOC) and Total signed the contract, the first by a European firm in more than a decade, in Tehran on Monday to develop phase 11 of South Pars field, which is the world's largest gas field.

The deal, worth $4.8 billion, was signed in Tehran by the National Iranian Oil Company Managing Director Ali Kardor, Total Chief Executive Officer Patrick Pouyanne and executives of China National Petroleum Corporation and Petropars, the French company's partners in the South Pars project.

The deal is expected to be signed on Monday in Tehran, with Total getting a 50.1 percent stake.

CNPC has been present in Iran since 2004, operating in oil, gas and oil field services, according to the company's website. The field, which holds an estimated 1,800 trillion cubic feet of gas, lies in the waters of the Persian Gulf between the two countries.

Iran has the second-largest gas reserves and the fourth-largest oil reserves in the world.

Iran claims that field will produce about 50.9 million cubic meters of gas per day once the latest phase of drilling is complete.

The offshore oil field, shared between Iran and Qatar, was first developed in the 1990s.

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Total was in a stronger position to make a deal than competitors like Royal Dutch Shell PLC, which has long eyed going back into Iran.

While Mr. Pouyanné can not rule out new sanctions, he and other potential investors were pleased when the Trump administration reapproved waivers, originally signed by the Obama administration, exempting global companies that invest in Iran from certain United States sanctions.

Iran and the five permanent members of the United Nations Security Council - the United States, France, Britain, Russia and China - plus Germany signed the mammoth agreement in July 2015 and started implementing it in January 2016.

"The company has expressed willingness (about investment in Iran) and negotiations continue in this regard", he added.

The U.S. Congress has been pushing for a new set of sanctions against Iran and its hard-line Revolutionary Guard, a paramilitary unit responsible for recent ballistic missile tests that angered Washington.

Iran, the third largest producer in the Organization of the Petroleum Exporting Countries, hopes its new IPC contracts will attract foreign companies and boost oil and gas production after years of under-investment.

"We're the first Western major to return to Iran".

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