Chinese state-owned oil company CNPC will replace Total on a major gas field project in Iran if the French energy giant pulls out over renewed US sanctions against Tehran, Iran’s oil minister has said.
“Total has said that if it doesn’t get an exemption from the United States to continue its work, it will begin to pull out of the deal,” Bijan Namdar Zanganeh was quoted as saying by his ministry’s Shana news service.
“If that happens, the Chinese firm CNPC will replace Total.”
Total started the USD 4.8-billion South Pars 11 project in July 2017, two years after Western powers signed a nuclear deal with Tehran prompting the return of many businesses to Iran.
But earlier this month, US President Donald Trump announced his withdrawal from the deal, and warned companies that they face sanctions if they do business with Iran.
The French group said Wednesday it has USD 10 billion of capital employed in its US assets, and US banks are involved in 90 percent of its financing operations, making Total highly vulnerable if targeted by any US actions.
By contrast, Total said it had spent less than EUR 40 million euros on the Iranian project, which it runs with its partner Petrochina and which is dedicated to the supply of domestic gas inside Iran.