French oil giant Total has signed an agreement with Iranian authorities for a 50 per cent stake in Iran’s South Pars project which will developed at an investment of $4 billion, according to a report.
The South Pars field will begin production by the end of the fiscal year, said Oil Price.com citing 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, it stated.
The move makes Total the first Western supermajor to sign a deal with Iran on energy following the easing of sanctions.
In a regulatory filing with the US Securities and Exchange Commission (SEC), Total said it would finance 50.1 per cent of the South Pars 11 project, which requires a total investment of $4 billion.
If this deal goes through, Total would be the operator of the project, while China’s CNPC would hold a 30-per cent interest through a subsidiary, while Iran’s Petropars would hold 19.9 per cent, stated the report.
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.
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.