Total to develop Iranian gas field
Biggest deal since sanctions lifted
TEHRAN, July 2, (AFP): French energy giant Total will finally sign its multi-billion-dollar agreement to develop an Iranian offshore gas field on Monday, the oil ministry said, in the biggest foreign deal since sanctions were eased last year.
“The international agreement for the development of phase 11 of South Pars will be signed on Monday in the presence of the oil ministry and managers of Total, the Chinese company CNPC and Iranian company Petropars,” a ministry spokesman told AFP.
Total signed a preliminary deal with Iran in November, taking a 50.1 percent stake in the $4.8 billion (4.2 billion euro) project.
China National Petroleum Corporation (CNPC) will own 30 percent and Petropars 19.9 percent.
Total will put in an initial $1 billion for the first stage of the 20year project.
The gas produced will “feed into the domestic Iranian market starting from 2021,” a Total spokesman told AFP in Paris.
He said the company would “implement the project with the strictest respect for national and international law”.
The contract was initially due to be signed in early 2017, but CEO Patrick Pouyanne said in February that Total would wait to see whether the US adminstration of President Donald Trump reimposed sanctions on Iran.
Trump threatened during his campaign to tear up the landmark accord between Iran and six world powers that came into force in January 2016 and eased sanctions in exchange for curbs to Tehran’s nuclear programme.
His administration has taken a tough line on Iran and imposed fresh sanctions related to its ballistic missile programme and military activities in the region.
But the White House has kept the nuclear deal alive, continuing to waive the relevant sanctions every few months as required under the agreement.
It is partway through a 90-day review on whether to uphold the deal, although any move to abandon it would be strongly opposed by the other signatories — Britain, France, Germany, China and Russia.
Monday’s signing will mark Total’s return to Iran, which has the second-largest gas reserves and fourth-largest oil reserves in the world.
The French firm led development of phases two and three of South Pars in the 1990s and had signed up to develop phase 11 back in 2009.
But it was forced to abandon
In addition, Gulf Bank has continued with initiatives to improve its risk profile.
The Bank has made visible progress in resolving its large legacy problems as shown by recoveries on old problem loans in 2016. S&P Global Ratings affirmed their ratings because of Gulf Bank’s business position and stability, derived from its status as the fourth-largest commercial bank in Kuwait.
Gulf Bank has market shares in loans and deposits of close to 10 percent and is improving its revenue mix. In S&P’s view, the Bank has delivered on its commitment to turn around its business model since the global turmoil in 2009.
Gulf Bank’s funding and liquidity profile will remain resilient to the low oil-price environment and support our ratings, said S&P Global Ratings. The bank’s broad liquid assets sufficiently cover short-term wholesale funding needs. its projects in Iran in 2012 when France joined European Union partners in imposing sanctions, including an oil embargo, over the country’s nuclear programme.
Iran’s oil officials have been keen to attract Western investment and know-how to improve the country’s outdated energy infrastructure.
Iran has also signed preliminary agreements with Shell and Russia’s Gazprom to develop oil and gas projects.
Such deals have not been without controversy in Iran, which has bitter memories of exploitation and interventions driven by foreign oil interests.
Conservatives criticised the move to award tenders to foreign firms last year.
That forced the oil ministry to confirm that domestic conglomerates, including one controlled by the elite Revolutionary Guards, would be allowed to compete.
The first stage of the new 20year project at South Pars will cost around $2 billion and consist of 30 wells and two well-head platforms connected to existing onshore treatment facilities.
The site will eventually pump 50.9 million cubic metres (1.8 billion cubic feet) of gas per day into Iran’s national grid.
Reflect
The ratings continue to reflect S&P Global Rating’s view of Gulf Bank’s high systemic importance in Kuwait and the Kuwaiti authorities’ highly supportive stance toward the banking sector.
As a result, the long-term rating on Gulf Bank benefits from three notches of uplift, reflecting their view of a high likelihood of extraordinary government support for the bank if needed.
The positive outlook reflects a one-in-three likelihood that Gulf Bank will maintain the positive momentum in capital and risk over the next 24 months.
S&P mentioned that the rating of the Bank will be raised if the RAC ratio sustainably exceeds 10 percent, most likely through improved capital generation and moderate dividends.