TEHRAN (Nov 25, 2018): Iranian Oil Minister Bijan Namdar Zanganeh said China’s state-owned CNPC has officially replaced France’s Total in Iran’s multibillion-dollar South Pars gas project, Tasnim news agency reported on Sunday.
“China’s CNPC has officially replaced Total in phase 11 of South Pars but it has not started work practically. Talks need to be held with CNPC … about when it will start operations,” Zanganeh said.
Total signed a contract in 2017 to develop Phase 11 of South Pars field with an initial investment of $1 billion, marking the first major Western energy investment in the country after sanctions were lifted in 2016.
The company was pressured to leave Iran after the United States threatened to impose sanctions on companies that do business in the country.
The French company said in August it had told Iranian authorities it would withdraw from the South Pars gas project after it failed to obtain a waiver from U.S. sanctions against Iran.
In May, industry sources said CNPC was ready to take over Total’s stake in the project.
The offshore South Pars field holds the world’s largest natural gas reserves ever found in one place.
Total holds a 50.1 interest in the South Pars project with CNPC owning 30 percent and Iran’s Petropars 19.9 percent.
The offshore field was first developed in the 1990s and Total was one of the biggest investors in Iran until the international sanctions were imposed in 2006 over Iran’s nuclear program.
Total after the sanctions were lifted during President Obama’s tenure, decided to return and develop phase 11 of the South Pars project, which will cost up to $5 billion once operational.