News ID: 195810
Published: 0244 GMT July 01, 2017

Total eyes investment in Iran's petchem industry

Total eyes investment in Iran's petchem industry

While a contract between Iran and the giant oil and gas company Total SA on developing Phase 11 of Iran's South Pars Gas Field is being finalized, the giant French company has at the same time also launched talks on investing in Iran's petrochemical industry.

According to Tasnim News Agency, Iran and Total are in the final stages of hammering out a long-delayed deal focusing on Phase 11 of giant South Pars Gas Field.

The French company signed a draft agreement with the National Iranian Oil Company (NIOC) in November 2016, but announced in February 2017 that a final decision on the deal hinged on the new US administration renewing sanctions waivers on Iran.

The South Pars Phase 11 project will have a production capacity of 1.8 billion cubic feet per day, or 370,000 barrels of oil equivalent per day.

Meanwhile, reports suggest that Total has begun separate talks to have a share of Iran's lucrative petrochemical industry.

In February, Managing Director of Iran's National Petrochemical Company (NPC) Marzieh Shahdaei said Iran was in talks with Total, Germany's BASF and Britain's Shell on investment in the petrochemical industry.

She noted that the talks with Total were focused on construction of a petrochemical plant for producing ethylene and polyethylene.

Iran has signed a flurry of deals with Western companies over the past year since the easing of international sanctions on Tehran after an accord was reached over its nuclear program.

Iran needs foreign investment to repair and upgrade its oil and gas fields. It also seeks the transfer of technology to its oil industry after a decade of sanctions.

In November 2016, France's Total became the first oil major to sign a big deal with Tehran since the lifting of sanctions and agreed to help it develop the world's largest gas field, South Pars.

Shell signed a provisional deal in December to develop Iranian oil and gas fields South Azadegan, Yadavaran and Kish in December 2016.

Iran has named 34 companies from more than a dozen countries as being eligible to bid for oil and gas projects using the new, less restrictive contract model.

The firms include Shell, France's Total, Italy's Eni, Malaysia's Petronas and Russia's Gazprom and Lukoil, as well as companies from China, Austria, Japan and other countries.

Russia's Zarubezhneft signed an MoU to conduct feasibility studies on two joint fields in the west of the country.

Norway's International Aker Solutions Company signed an MoU to modernize Iran's oil industry.

In May 2016, Austria's OMV signed an MoU for projects in the Zagros area in western Iran and the Fars field in the south.

South Korean Daewoo Engineering and Construction (Daewoo E&C) signed an MoU to construct an oil refinery in Bandar Jask, on the southern coast of Iran.

Italy's Saipem signed MoUs to cooperate on pipeline projects, upgrading of refineries and development of Tous gas field in the northeastern province of Khorasan Razavi.

Norwegian oil and gas company DNO said it was the second Western energy company after Total to sign a deal with Iran under which it agreed to study the development of the Changuleh oilfield in western Iran.

Lukoil, Russia's second biggest oil producer, hopes to reach a decision on developing two new oilfields in Iran.

Germany's Siemens AG signed an MoU in May to overhaul equipment and facilities at Iran's oil operations and refineries.

BASF's Wintershall oil and gas exploration subsidiary signed an MoU with the National Iranian Oil Company in April 2016.

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