French oil giant Total pulls out of Iran over US sanctions
French oil giant Total has officially pulled out of Iran after the US threatened to impose sanctions on companies doing business in the country, according to Iranian state TV.
The country's oil minister Bijan Zanganeh said the process to replace Total – due to develop phase 11 of the South Pars gas field project – was under way.
He told ICANA, the Iranian parliament's official news website, that the company had originally announced its plan to withdraw from the project two months ago.
Iranian officials had earlier suggested China’s state-owned CNPC could take over Total’s stake in the South Pars gas project, lifting its interest to more than 80 percent from 30 percent now.
The United States reimposed sanctions on Iran after Washington withdrew from the 2015 nuclear agreement between Tehran and world powers. The agreement had imposed limits on Iran’s nuclear ambitions in exchange for sanctions relief.
In May Total said it would have to unwind all operations on the SP11 project by November unless it was granted a specific project waiver by the US authorities – protecting the company from any secondary sanction.
The company made it clear it could not commit further to the project but that it had spent less than €40m on the scheme so far.
Total said the withdrawal from Iran would not impact its production growth target of five per cent compound annual growth rate between 2016 and 2022.