The French oil giant Total has officially withdrawn from its investment projects in Iran worth more than several billion dollars, a direct consequence of the introduction of American sanctions against the country, the Iranian government announced on Monday.
– Total has officially terminated the contract for the development of phase 11 of the South Pars gas field, said Iranian Oil Minister Bijan Namdar Zanganeh, for the Icana agency linked to parliament.
– It has been more than two months since he announced that he would terminate the contract, he added.
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Zanganeh, responding to questions from representatives about several recent fires at refineries, also warned of the catastrophic state of the oil and gas infrastructure in the country, saying it needs to be renewed, and that Iran does not have the money for it.
Some refineries are 80 years old, and the lifespan of a factory is around 30 years, he said.
– We have no means to renew them, he said.
>>> French Total Withdraws from Project in Iran
Total, at the head of a consortium with China’s CNPCI and Iran’s Petropars, signed an agreement in July 2017 for the development of a large offshore gas field in the south of the country worth $4.9 billion.
Initially, it was supposed to invest $1 billion, but in May it announced that it had invested only €40 million due to the increasingly uncertain situation in relations with the US.
Total has $10 billion in assets in the US, and American banks participate in 90% of its financial operations, so it would be severely affected by American sanctions.
It is not known whether the Chinese consortium CNPCI will take the lead in the consortium.
Iran is cautious about Chinese investments due to bad experiences. In 2011, it already suspended one contract with CNPCI because the Chinese group did not implement the project in the South Pars field.
>>> European Companies Withdraw from Projects in Iran After Announced Sanctions
Washington unilaterally withdrew in May from the international nuclear agreement made with Iran in 2015, and on August 6, it imposed the first package of sanctions and announced a second one aimed at the oil sector for November. The first round of sanctions relates to the automotive sector and air traffic as well as the import of raw materials.
Other signatories of the agreement with Iran – the United Kingdom, France, Germany, China, and Russia – claim they want to preserve the agreement, but their companies will be subjected to severe sanctions if they continue to operate in that country.
Washington has set a deadline of 90 to 180 days for foreign companies to withdraw from Iran. Among the many companies that have already announced their departure from Iran, fearing American sanctions, is the German Daimler.
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Iranian Foreign Minister Mohammad Javad Zarif stated on Sunday that Europe has not yet shown the will to “pay the price” for saving the nuclear agreement.
Zarif said that European governments have proposed measures to preserve ties with Iran in the oil and financial sectors after the second round of sanctions announced for November.
But it is more of a “statement of intent than concrete measures,” Zarif said for the Iranian Young Journalists Club portal.
– We believe that Europe is not yet ready to pay the price by resisting American sanctions, he said. Total has already indicated that it would not be able to stay if it did not receive an exemption from the US, which it did not receive.
– Europeans say that the nuclear agreement is a security success for them. It is logical that every country must invest and pay the price for its security. We must see them pay the price in the coming months, Zarif said.
