Total Keen on Development Projects, Marketing LNG

Total Keen on Development Projects, Marketing LNGTotal Keen on Development Projects, Marketing LNG

French oil and gas giant Total is ready to resume and expand operations in the Iranian energy sector, head of the Oil Contracts Restructuring Committee at Iran's Oil Ministry said.

After meeting Arnaud Breuillac, the head of Total's exploration and production, in Tehran on Sunday, Seyyed Mehdi Hosseini noted that Total wants to play a role in exploring and developing oil and gas fields, and help boost extraction from Iran's rich hydrocarbon resources, in the latest sign of thawing relations between Tehran and Paris, ISNA reported.

"The two countries are planning to draw a comprehensive roadmap for cooperation in the post-sanctions era," he said.

Breuillac expressed Total's interest in buying and marketing liquefied natural gas, or LNG, from Iran.

A high-ranking delegation of French officials and business-owners, headed by Agriculture Minister Stephane Le Foll and Minister of Foreign Trade and Tourism Matthias Fekl, along with representatives from 150 companies, including Total and Peugeot Citroen, arrived in Tehran on Monday to explore areas of bilateral cooperation.

Negotiations with Total have been in the works for months, after Iran and six world powers reached a historic deal on July 14 in Vienna, which would limit the Persian Gulf country’s nuclear program in return for removing sanctions on its energy and financial industries.

The Iranian Offshore Oil Company announced last week that preliminary negotiations had been held with several European heavyweights, including Total and Italian firms Eni and Saipem, without giving details.

Total was active in developing Iranian energy projects for more than 20 years, including the development of Iran's biggest gas field, South Pars, which holds about half of the country's gas reserves.

However, it ceased operations in Iran in 2010 following disagreements over contract terms as well as pressure from the French and US governments over oil and trade sanctions against Tehran.

Trailing Behind

French officials say they have fallen behind their European, American and Asian rivals in reviving economic ties with Iran since the nuclear deal was reached more than two months ago.

“We have fallen behind, so now we have to make up lost ground,” said Thibault de Silguy, the vice president of MEDEF lobbying group leading the delegation, citing Germany, Austria, China and the US as countries upfront.

French imports from Iran fell to $70 million (€62 million) in 2013 from $1.9 billion in 2011. Exports fell to $558 million in 2013 from $1.8 billion in 2011, according to French Foreign Ministry estimates.

The French delegation is the latest European mission to arrive in Tehran to explore grounds for cooperation. Tehran has hosted top trade delegations from Spain, the Netherlands, Austria, Spain and Germany in the past few weeks, preparing multibillion-dollar agreements in economic and energy sectors for the post-sanctions period.

Thawing Ties

France took one of the hardest lines of the six powers negotiating the nuclear agreement. But Foreign Minster Laurent Fabius, who traveled to Tehran over the summer to smooth over relations, has repeatedly said he did not believe that would hurt its companies once sanctions against Iran were lifted.

In a sign of enthusiasm to improve relations with western countries, including France, President Hassan Rouhani agreed to visit Paris in November as his first official visit to a European state and the first by any Iranian president in more than a decade.

Meanwhile, Amirhossein Fallah, National Petrochemical Company's deputy for investment, said European firms are competing with Asian rivals to claim a stake in Iran's lucrative petrochemical sector.

"We believe a big proportion of petrochemical development plans can be completed by European investment," he said, without naming names, adding that the key sector is an attractive investment opportunity for foreign companies.