EghtesadOnline: Total S.A. has picked a domestic partner as part of a project to develop an offshore phase of Iran's South Pars Gas Field, an official said.
Reza Khayyamian, the head of the Society of Iranian Petroleum Equipment Manufacturers, asserted that the French company has held up its end of the bargain in the gas venture, ISNA reported.
"Total has chosen the domestic company through a tender," he said.
Khayyamian noted that Total has divided the mega project into "several packages" for which the French company will choose subcontractors through tenders, many of whom are expected to be Iranian companies, Financial Tribune reported.
"The name of the winner will be made public by Total in the near future," he said.
The deal will likely entail the production and supply of equipment for SP Phase 11 aimed at producing 56 million cubic meters of natural gas per day.
Total signed the gas deal, worth around $5 billion, in July. The contract gives China’s top oil and gas company CNPC the option to take over Total’s stake if it pulls out of the venture to comply with any new US sanctions, according to sources involved in the talks, Reuters reported this month.
The deal was the first major western energy investment in Iran since international sanctions were lifted as part of a landmark agreement in 2015 over Iran’s nuclear program.
US President Donald Trump refused in October to certify that Tehran is complying with the deal and since the US Congress kicked the ball back into his court, he will have to again take a decision by mid-January.
Total Chief Executive Patrick Pouyanne has said his company would leave, if it was no longer able to operate in Iran.
Total and CNPC have 50.1% and 30% stakes, respectively, while Iran's state-owned Petropars holds the remaining 19.9%.
A change in ownership structure would mean that CNPC would shoulder 80% of the cost of the project, estimated at $2 billion for the first stage.
The Phase 11 project will be developed in two phases. The first phase, at an estimated cost of $2 billion, will consist of 30 wells and two wellhead platforms connected to onshore treatment facilities by two subsea pipelines, a statement on Total's website reads.
At a later stage, a second investment phase, involving the construction of offshore compression facilities, will be launched when the reservoir conditions demand it.