Fri | Jan 19, 2018

Iran signs US$4.8b gas deal with Total

Published:Wednesday | November 9, 2016 | 12:00 AM
Head of the Middle East and North Africa division at Total, Stephane Michel, (left), and managing director of the National Iranian Oil Company, Ali Kardor, (right), shake hands after signing documents in Tehran, Iran, on Tuesday, November 8.

Iran on Tuesday signed a preliminary US$4.8 billion gas agreement with the French company Total, the first such deal after a nuclear accord with world powers removed international sanctions that had squeezed its fossil fuel-based economy.

The agreement, to be finalised next year, is for new development at the vast South Pars gasfield, and aims to produce 1.8 billion cubic feet (56 million cubic metres) of gas per day for domestic consumption and export.

Total would have a 50.1 per cent stake, the China National Petroleum Corporation would have 30 per cent, and Petropars, a subsidiary of Iran's national oil company, will have 19.9 per cent ownership. The three-year project includes 30 wells, two offshore platforms and two pipelines extending 85 miles (136 kilometres).

Iran seeks to be a gas production hub to feed neighbouring countries as well as Europe and China. It currently produces some 500 million cubic metres of gas per day, which mainly goes to domestic consumption.

The landmark nuclear deal came into effect at the start of this year. It lifts international sanctions on Iran in return for Tehran curbing its nuclear programme.

- AP