News ID: 234776
Published: 0333 GMT November 25, 2018

China's CNPC replaces Total in Iran’s multibillion-dollar project

China's CNPC replaces Total in Iran’s multibillion-dollar project

China’s state-owned CNPC has replaced France’s Total in Iran’s multibillion dollar South Pars gas project, Iranian Oil Minister Bijan Namdar Zanganeh said, according to the semi-official news agency ICANA 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 told ICANA.

In July 2017, the NIOC awarded the project to a consortium comprising Total (50.1 percent), China’s CNPC (30 percent) and Iran’s Petropars (19.9 percent) through a contract worth around $4 billion.

However, when the US announced that it would restore sanctions against Iran, the French major said it would withdraw from Phase 11 to avoid American punitive measures.

This triggered speculations that CNPC would assume Total’s share in the project to be the consortium leader with a total share of around 80 percent. 

Total had signed up to develop the same project back in 2009 but was forced to abandon its projects in Iran in 2012 when France joined a US-led campaign to put sanctions, including an oil embargo, against the country.

The objective of the development of Phase 11 was to produce a daily of above 56 million cubic meters (around 2 billion cubic feet) of natural gas into Iran’s domestic grid from 2021.

In early August, US President Donald Trump signed an executive order which made the sanctions against Iran effective.

The sanctions have undermined the sovereignty of European countries, for they cannot decide about their international trade without US “permission”. This has irked the European leaders who are thinking of more independent policies from the US in the future.

 

   
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