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Iran, Total resume talks on gas project

Tehran, October 10, 2009

Iran's state oil firm and Total have resumed talks about the French energy company's participation in a major liquefied natural gas (LNG) project after a gap of several months, a news agency said on Saturday.

The semi-official Mehr News Agency said a new round of negotiations had begun in Tehran, without specifying when it happened.

"In the meeting between the two companies' officials, the French party once more announced its readiness to undertake the project," Mehr said.

A Total spokeswoman declined to comment.

In June, the official Iranian news agency IRNA said Tehran had signed a $4.7 billion contract with China National Petroleum Corporation (CNPC) to develop phase 11 of the South Pars gas field, replacing Total which it had accused of delays.

"If interested, Total can cooperate with the Chinese company in the downstream sector of the project," Mehr on Saturday quoted Seiffollah Jashnsaz, head of the National Iranian Oil Company (NIOC), as saying.

Total has a memorandum of understanding (MoU) with NIOC to develop Phase 11 but the project was overshadowed by haggling over contract terms.

Total chief executive Christophe de Margerie said in July that its negotiations with Tehran on a multi-billion dollar contract to develop the gas field were at a standstill.

Iran has the world's second largest gas reserves, almost 16 per cent of the world's total, but currently has no major net exports partly because US and UN sanctions have deterred investment by Western firms with expertise and technology.

Iran is drawing interest from Indian and Chinese firms seen as less susceptible than many other companies to such pressure, but industry experts say it will be many years before Iran becomes a major gas exporter despite its resources.

The South Pars reservoir is shared by Iran and Qatar. The Iranian part is divided into 24 phases. – Reuters




Tags: Iran | Total | LNG | Tehran | gas project |

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