Iran, To­tal agree big gas deal

The Star Early Edition - - WORLD -

IRAN signed a for­mal con­tract with To­tal to de­velop its share of the world’s big­gest nat­u­ral gas field – the first in­vest­ment in the coun­try by an in­ter­na­tional en­ergy com­pany since sanc­tions were eased last year.

The 20-year deal with Na­tional Ira­nian Oil Co and China Na­tional Pe­tro­leum Corp to de­velop phase 11 of the South Pars off­shore gas field rep­re­sents the “first of many” projects for To­tal in Iran, chief ex­ec­u­tive Pa­trick Pouyanne said on Mon­day at a sign­ing cer­e­mony in Tehran.

To­tal will be op­er­a­tor of the project, with the first phase es­ti­mated to cost the part­ners about $2 bil­lion (R26.4bn).

Iran’s Oil Min­is­ter Bi­jan Nam­dar Zan­ganeh put the over­all value of the con­tract at about $5 bil­lion.

The agree­ment is “a big deal” for Iran and “will open the door for more com­pa­nies to sign con­tracts” with the coun­try, said Robin Mills, the head of Dubai-based con­sul­tant Qa­mar En­ergy.

It “also gains the Ira­ni­ans some diplo­matic cover from both France and China in the event of at­tempts to im­pose fur­ther sanc­tions,” he said.

He was re­fer­ring to an­tag­o­nism to Iran ex­pressed by some US gov­ern­ment of­fi­cials, in­clud­ing Pres­i­dent Don­ald Trump.

South Pars is Iran’s sec­tion of the world’s big­gest gas de­posit, shared also with Qatar.

The Per­sian Gulf field lies at the cen­tre of a dis­pute em­broil­ing Qatar and sev­eral Arab neigh­bours.

Saudi Ara­bia sev­ered com­mer­cial links with Qatar last month, ac­cus­ing it of cozy­ing up to arch-ri­val Iran.

Qatar ini­tially faced a Mon­day dead­line to com­ply with 13 de­mands from a Saudi-led coali­tion, in­clud­ing a cut­back in re­la­tions with Iran.

The coali­tion later ex­tended its dead­line by two days, the state-run Saudi Press Agency re­ported.

Iran holds the world’s largest gas re­serves, es­ti­mated by BP at 33 tril­lion cu/m, and is the third-big­gest oil pro­ducer in the Or­gan­i­sa­tion of Pe­tro­leum Ex­port­ing Coun­tries.

The pro­ducer is woo­ing com­pa­nies such as To­tal, Royal Dutch Shell and Rus­sia’s Lukoil PJSC to in­vest in its oil and gas fields to boost out­put.

Its oil pro­duc­tion climbed 33% last year af­ter sanc­tions re­lated to its nu­clear pro­gramme were eased in Jan­uary 2016. Bloomberg

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.