Iran will not reimburse Total for the money it has spent so far on the South Pars 11 natural gas project until the project becomes operational, local media reported Iran's Oil Minister Bijan Zanganeh as saying on Saturday.
The news agency of the country’s oil ministry, Shana, citing ICANA, the Iranian parliament's website, reported Zangeneh as saying the French energy major is not expected to pay a fine to Iran for withdrawing from the contract to develop phase 11 of the supergiant South Pars gas field in the country.
However, the amount already spent will not be repaid until the project becomes operational, Zangeneh added.
The minister also confirmed that Total had no remaining project equipment in Iran.
Total had announced on May 16 that it would "not be in a position to continue" the project in Iran and would "have to unwind all related operations before Nov. 4, 2018 unless Total is granted a specific project waiver by the U.S. authorities with the support of the French and European authorities".
It said the decision was taken "as a consequence" of U.S. President Donald Trump's May 8 announcement to pull out of the nuclear deal between world powers and Iran known as the JCPOA, and re-impose sanctions against Tehran.
The French energy major had confirmed earlier in May that its actual spending to date with respect to the South Pars 11 contract was less than €40 million ($47.2 million) in group share, and a withdrawal would not impact its production growth target of 5 percent compound annual growth rate between 2016 and 2022.
The contract for developing phase 11 of the South Pars field was signed between National Iranian Oil Company (NIOC) and a consortium of Total, China National Petroleum Corporation (CNPC) International and Petropars in 2017 with Total's initial investment of $1 billion.
CNPC International will take over Total's share of the contract, increasing the Chinese company’s share to 80.1 percent.
By Hale Turkes