https://www.dw.com/en/french-energy-giant-total-officially-pulls-out-of-iran/a-45150849
France's Total had signed up last year to a $4.8 billion Iranian gas field project. However, it was forced to backtrack after the US threatened to impose penalties on any business found still doing business with Iran.
US sanctions against Iran are back in effect / Sanctions signed off
US
President Trump signed an executive order on August 5 aimed at piling
financial pressure on Tehran to force a "comprehensive and lasting
solution" to Iranian threats, including its development of missiles and
regional "malign" activities. Trump warned that those who don't wind
down their economic ties to Iran "risk severe consequences."
Total, France's largest energy company, announced on Monday it was
pulling out of a $4.8 billion (€4.1 billion) Iranian gas field project,
after admitting it was extremely vulnerable to the threat of US
penalties against those doing business with Iran.
The French
group was one of three major energy companies set to help supply
the state-of-the-art technology needed to tap into South Pars, the
world's largest natural gas field shared by Iran and Qatar.
However, after abandoning the 2015 Iran nuclear accord in May this year, the United States has said it will reimpose sanctions on Iran
in two phases, in August and November. The second round of sanctions
will target the country's vital oil and gas sector. Any firm found doing
business with Iran could risk facing serious US penalties.
"Total has notified the Iranian authorities of its withdrawal from
the contract following the 60-day deadline for obtaining a potential
waiver from the US authorities," the oil and gas giant said in a
statement. "Despite the backing of the French and European authorities
such a waiver could not have been obtained," it said.
The French energy giant had been due to invest an initial $1 billion into the 20-year gas field project,
which it signed up to in July 2017 along with the state-owned China
National Petroleum Corporation (CNPC) and Iran's Petropars. Total first
announced in May that it was halting investment in the project, adding
that it had spent less than €40 million to date, amid increasing
uncertainty over US actions in the region.
Total also admitted it
would be extremely vulnerable to US penalties; it has some $10 billion
of capital employed in its US assets, while American banks are involved
in 90 percent of its financing operations.
Europe's exodus from Iran
While
US has threatened stiff sanctions on Western companies operating in
Iran, the nuclear agreement's other parties — Britain, France, Germany,
China and Russia — have vowed to stay true to the deal and urged businesses to follow their lead.
However, European firms have, understandably, opted to withdraw from
Iran's weak economy rather than draw the ire of Washington and risk
losing access to operations that require U.S. dollars.
Automakers PSA, Renault and Daimler have all announced plans to either suspend or drop investment in Iran, as have Germany's Deutsche Bahn and Deutsche Telekom.
US
President Donald Trump's decision to walk away from the nuclear accord
and reimpose sanctions has exacerbated Iran's economic woes. Its rial
currency has lost almost half its value since April, leading to
financing difficulties at local banks and heavy demand for US dollars among the population.
Trump
has told Tehran that its only chance of avoiding sanctions would be to
accept his offer to renegotiate a tougher nuclear deal. Iranian
officials have repeatedly rebuffed that offer.
dm/jm (AFP, Reuters, AP)
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