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U.S. President Donald Trump is officially withdrawing his certification of Iranian compliance with the nuclear deal, in what is being billed as part of a tougher strategy on Iran.
For Europe, the past few weeks have been ones of scrambling to determine whether billions of dollars in deals made by major European companies with Iran will be stymied by a new round of sanctions. Those deals include the almost $5-billlion energy deal between French Total SA and Iran.
But maybe all is not lost. Essentially, Trump has “kicked the can” to Congress, according to the Atlantic, in a move designed to convince the public that he’s kept his campaign promise on Iran—even if the agreement remains in place.
According to the New York Times, Trump’s ‘decertification’ isn’t “unraveling” or even “rewriting” the accord with Iran.
During his campaign, Trump called this “the worst deal ever”, and an “embarrassment”. He promised to get rid of it altogether. Friday’s withdrawal of certification, however, does not involve a renegotiation of the deal.
Indeed, now it’s up to Congress to decide whether to reimpose sanctions on Iran, and now Europe has had another 24 hours to digest the repercussions of the ‘de-certification’ and what it means for its deals with Iran.
For French energy giant Total SA, it may make doing business in Iran more difficult.
Total signed its deal with Iran in July, making recent history. This was the first deal Iran signed with a foreign energy company since sanctions were lifted in January 2016.
The $4.8-billion deal is to develop Iran’s prolific South Pars natural gas field—the largest gas field in the world, shared with Qatar. Total would lead the consortium.
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Throughout, Total SA has taken the challenge head on. Earlier this month, the French oil giant shrugged off the US sanctions threat, with Total CEO Patrick Pouyanne telling media, “We knew when we signed that it will not be an easy road. But I prefer to have a problem to solve and to have the opportunity rather than having not signed [and] no opportunities.”
Now that the dust is settling on the Iran nuclear deal, and it is becoming clearer that this move was a compromise and the deal is not being abandoned outright, European companies may be feeling less pressure to come up with a contingency plan.
By Damir Kaletovic for Oilprice.com
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Damir Kaletovic is an award-winning investigative journalist, documentary filmmaker and expert on Southeastern Europe whose work appears on behalf of Oilprice.com and several other news…