Petrochemical hassle between Iran, Qatar and Total

Prior to the lifting of international sanctions against Iran in January 2016 within the framework of the Nuclear Deal (JCPOA) signed by the major powers (P5+1) in July 2015, the French energy group Total had started effective talks with Tehran with a view to exploring and exploiting petrochemical deposits.

According to information published by Cyceon in October 2016, Total has asserted itself as the most active European company in the Iranian energy sector with heads of agreements valued at USD 2 billion to be finalized by March 20, 2017 in line with a preliminary agreement signed almost two years before the JCPOA.

Delayed till summer 2017, the contract’s signature with NIOC, Iran’s national company, under the Iranian Petroleum Contract (IPC) recently approved by the Iranian parliament could actually be compromised following Tehran’s accusation of Total having leaked to Qatar – an “economic rival” – secret information about Iran’s South Pars, the world’s largest natural gas reservoir.

With Russia, Iran and Qatar have the largest proven conventional gas reserves in the world. If the Iranian parliament’s energy commission inquiry concludes that leaks did occur, Tehran has warned that prosecution could be initiated through international courts. Several analysts also wondered whether the accusation could partly be a response to the postponement decided by Total of the contract’s signature, a move that clearly displeased Tehran.

Confirming the warnings issued by Cyceon, Total has effectively opted for caution in order to learn more about the recently strengthened US sanctions against Iran. As it stands, however, economic and diplomatic contacts seem to continue normally between Iran and France.