Royal Dutch Shell (NYSE:RDS.A) is expected to sign later on Wednesday a preliminary deal to develop oil field projects in Iran, in a sign that oil majors have not backed away after Donald Trump – who had pledged to tear up the nuclear deal with Iran – was elected U.S. President, The Wall Street Journal reported, quoting a spokeswoman with the Iranian petroleum ministry.
The non-binding agreements that Shell is expected to sign are for the development of the large-scale projects of the South Azadegan and Yadavaran oil fields, the WSJ said.
The deal would be similar to the one that France’s oil major Total SA (NYSE:TOT) signed in early November, becoming the first supermajor to return to investing in Iran after the international sanctions were lifted in January. Total is leading a consortium to develop phase 11 of the South Pars gas field, which is expected to have a production capacity of 1.8 billion cubic feet per day, or 370,000 barrels of oil equivalent per day.
In March this year, Trump said in a speech addressing the American Israel Public Affairs Committee:
“My number-one priority is to dismantle the disastrous deal with Iran.”
Analysts and observers are divided on whether Trump could have the power to dismantle the multi-nation deal, but it seems that oil majors are undeterred by potential losses in Iran should Trump really be able and willing to tear up that deal.
Total’s head of exploration and production, Arnaud Breuillac, said in an interview last week that he was “not particularly” worried about a Trump presidency and Total’s plans for doing business in Iran, according to the WSJ.
Oilfield services major Schlumberger (NYSE:SLB) seems equally unconcerned, even after it was hit with a fine for violating Iranian sanctions, and has recently signed a memorandum of understanding with the National Iranian South Oil Company for the development of oilfields in Iran’s southern Khouzestan province.
Just yesterday, the National Iranian Oil Company (NIOC) and Thailand’s company PTT Exploration and Production signed a deal under which the Thai company would carry out studies for the development of the Changouleh, Dalpari and Belal oilfields in Iran.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for the U.S.-based Divergente LLC consulting firm with over a decade of experience writing for news outlets such as iNVEZZ and…