Total signed a preliminary deal for the project last year, and today stated its intentions in a regulatory filing with the U.S. Securities and Exchange Commission (SEC).
The move makes Total the first Western supermajor to sign a deal with Iran on energy following the easing of sanctions.
According to Total’s SEC filing, the company would finance 50.1 percent of the South Pars 11 project, which requires a total investment of US$4 billion.
If this deal goes through, Total would be the operator of the project, while China’s CNPC would hold a 30-percent interest through a subsidiary, while Iran’s Petropars would hold 19.9 percent.
A final investment decision is expected from Total this summer, while Iran is expected to finalize contracts in April, according to Reuters.
It gets tricky, though, with the possibility that the new regime at the White House may not renew sanctions waivers.
The Persian Gulf South Pars field will begin production by the end of the fiscal year, according to Iranian officials. The first stage of production will see output of 35,000 barrels per day, while the second stage will increase to 100,000 bpd.
Iran shares ownership of the gas reserves in the largest field of its kind with Qatar. The 14-trillion-cubic-feet find represents eight percent of the world’s known reserves.
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Total is also considering other investments in Iran, including a 10-million-tonne/year liquefied natural gas (LNG) plant and an investment in the South Azadegan oil field.
The French oil major resumed trading with Iran in February last year, when it bought US$1.9 billion in crude from Tehran.
In February, Iran voiced concerns that Total had disclosed data about South Pars to neighboring Qatar, warning the French company that it may have to compensate for this.
By Damir Kaletovic for Oilprice.com
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Damir Kaletovic is a veteran investigative journalist covering Europe and the Middle East, and a senior consultant for Divergente Research.