Iran's Oil Minister Bijan Zangeneh has announced Tehran’s decision to give French energy giant Total 60 days to win a sanctions waiver from the US or it would lose its stake in a multi-billion-dollar gas project.
"Total has 60 days to negotiate with the US government," Zanganeh has been quoted as saying according to the official Shana news agency.
"The French government too can have negotiations with the US government during these 60 days for Total to stay in Iran," he said.
Total was the only western firm to finalise an investment deal in Iran's energy sector following the 2015 nuclear deal, from which the US administration of President Donald Trump withdrew on 8 May.
Total signed the agreement last July to become the lead partner in a $4.8bn project to develop the South Pars 11 offshore gas field, alongside the China National Petroleum Corporation (CNPC) and Iran's state-run Petropars.
But after Washington quit the deal and pledged to fully reimpose sanctions on Iran’s energy industry by November, Total has said it will be impossible to continue unless it gets a specific waiver from Washington.
If the French company fails to win an exemption, CNPC "will replace Total in this project," Zanganeh said.
The oil minister did not explain why the French firm only had 60 days, with US sanctions on foreign energy companies in Iran not due to kick in until 4 November.
Even before Washington pulled out of the nuclear deal, Iran had struggled to attract investment into its oil and gas sector.
The only other deal was a $742m deal with Russian state-owned firm Zarubezhneft to boost production at two oil fields in the western province of Ilam.
Hardliners in Iran had opposed foreign investment in the energy sector despite the government saying billions were needed to realise its potential.
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