Baku, November8, Nihad Budaqov, AZERTAC
France's Total and China National Petroleum Corp are set to sign the first major agreement with Iran for the development of its gas fields since the loosening of international sanctions in January, according to Financial times.
Iran's oil ministry said on Monday it expected to finalize the preliminary deal, involving development of a new phase of the giant South Pars gas field, on Tuesday. This would represent a breakthrough in Tehran's efforts to attract renewed investment in its outdated energy infrastructure and unlock some of the world's biggest oil and gas reserves.
For Total, the deal would open the way for its return to Iran six years after the French oil major exited the country amid international tensions over Tehran's efforts to make a nuclear bomb. It would also highlight Total's hunt for new sources of growth in spite of persistent weakness in the oil market.
Total declined to comment on the expected agreement with Tehran but, in an interview with the Financial Times, Patrick Pouyanné, chief executive, highlighted Iran among the places he was interested in investing.
He said new oil and gas projects were urgently needed to stave off supply shortages after the sharp downturn in industry capital expenditure since oil prices started falling in mid-2014.