Iran faces Total withdrawal, signs new oil contract with Pergas

Iran US PerIran aims to ramp up the domestic oil production and export to the international market. (Image source: Dan DeLuca/Flickr)

Iran has signed a new deal with London-based Pergas to develop the Keranj oilfield, on the same day that Total announced it will withdraw from the South Pars 11 gas project unless it can be granted a waiver from the USA to protect it from secondary sanctions

Under the preliminary agreement, an international consortium is expected to produce 655 mbl of oil from the Keranj field in Khuzestan province, located in the southwest Iran, for a period of 10 years.

Yesterday, Total announced its intention to pull out of Iran’s South Pars gas deal, a US$5bn contract which the company signed in 2017, in light of President Donald Trump’s decision to withdraw from the JCPOA and to reinstate the US sanctions that were in force before the JCPOA’s implementation.

“Total will not be in a position to continue the SP11 project and will have to unwind all related operations before 4 November 2018, unless Total is granted a specific project waiver by the US authorities with the support of the French and European authorities,” said the French oil giant.

“This project waiver should include protection of the Company from any secondary sanction as per US legislation,” the company noted.

As reported by Reuters, Iranian oil minister Bijan Zanganeh said that Iran expects European countries to make up for the US “betrayal” of the nuclear deal and encourage Western companies that sign deals with Tehran.

Iran aims to ramp up domestic oil production and exports to the international market. Zanganeh noted that the country will definitely overcome the difficulties that result from the US withdrawal from the nuclear deal.

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