Energy giant Total pulls out of gas development project in Iran

Total seeks exemption from US sanctions for Iran gas project

Europe to exempt its firms from US sanctions on Iran

Total said it might quit a multi-billion-dollar gas project if it could not secure a waiver from USA sanctions.

It added that as a effect, "Total will not continue the SP11 project and will have to unwind all related operations before 4 November 2018, unless Total is granted a specific project waiver by U.S. authorities with the support of the French and European authorities".

The group mentioned it has $10 billion of capital employed in its United States belongings, and USA banks are concerned in 90 % of its financing operations, making Complete extremely weak if focused by any U.S. actions.

A withdrawal from the Iran challenge wouldn't have an effect on Complete's present general manufacturing targets because the group had since opened up different progress alternatives, it mentioned.

Total called for a waiver that would stipulate the company's protection from "any secondary sanction as per U.S. legislation".

"The risks of being on the wrong side of the USA government are not worth the benefits of trading with Iran once the sanctions are in place", said Jason Gammel, a London-based analyst at Jefferies LLC.

Iran's energy ministry predicted past year that the Total-led project would eventually produce tens of billions of dollars worth of gas products.

He explained that the French company will not be fined for pulling out of the contract, but added that Total's expenditure on the contract will not be paid back until completion of the project.

Germany, France and the United Kingdom have vowed to stick with the nuclear deal and they're talking to Iranian officials about how to protect the economic benefits it offered Tehran.

Danish oil product shipping operator Maersk Tankers said it would wind down its customer agreements in Iran by November, while German insurer Allianz said on Tuesday it was preparing to wind down Iran-related business.

The EU's top energy official, Commissioner Miguel Arias Canete, is meanwhile heading to Iran on May 18-21 for talks on energy cooperation, a symbolic gesture from the EU that it wants to stay engaged despite the U.S. withdrawal.

Last week, President Donald Trump withdrew the United States from the Iran nuclear agreement. Joe Kaeser, the CEO of Germany's Siemens (SIEGn.DE), told CNN his company would not be able to do any new business with Tehran. Total does about 30 percent of its business through the USA banking system.

In a deal first signed in late 2016, Total agreed to operate the South Pars project with a stake of 50.1%. "With that in mind it's a logical decision".

Industry sources told Reuters this week that China's CNPC, which holds a 30 percent stake in the South Pars project, was ready to take over Total's majority stake in the project if it pulled out.

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