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Total to withdraw its operations from Iran due to US sanctions

Several attempts by Total to waiver itself from US  turn up with no results and finally the company has to withdraw itself from Iran.

Total was planning to follow up its South Pars gas field development project in Iran with major petrochemical investments. The contractual process is ongoing. Total has notified the Iranian authorities of its withdrawal from the [South Pars Phase 11] contract following the 60-day period specified in the contract to obtain a potential waiver from the US authorities,” said the company.

“Despite the backing of the French and European authorities, such a waiver could not have been obtained. Total owns 50.1% of the South Pars Phase 11 project, while the Chinese National Petroleum Corporation (CNPC) has 30% and Iran’s Petropars holds the rest.

Under the contract, CNPC has the right to take over Total’s stake in the event of the latter’s withdrawal. Total became the first energy major to return to Iran since the January 2016 implementation of the nuclear deal curbing the country’s nuclear activities.

Iran has the second-largest gas reserves and fourth-largest oil reserves in the world, but has estimated it needs towards $200bn of investment to revive its rundown oil, gas and petrochemicals sector over the next five years, with towards $40bn needed for the petrochemicals industry alone.