Skip to comments.Political Tensions Force Total to Pull Out of Iran
Posted on 07/12/2008 10:08:53 AM PDT by fella
Political Tensions Force Total to Pull Out of Iran by David Jolly, The New York Times Media Group International Herald Tribune 7/11/2008 URL: http://www.rigzone.com/news/article.asp?a_id=64066
Total, the French oil giant, has decided to back away from planned investments in Iran because of political uncertainty, a company official said Thursday.
Total's withdrawal from Iran, including a planned massive gas project in the South Pars gas field, makes it the last major Western oil company to give up on Iran amid pressure from Washington to stop doing business with the Tehran government. The United States, Israel and other Western countries say Iran is seeking to developing nuclear weapons, but Iran says the program is for civilian purposes.
"We think that under current conditions it is not possible in Iran just now," Patricia Marie, a spokeswoman for Total, said. But she said Total took a long-term view of the country's strategic importance to its business. "We are still interested in Iran."
The news was first reported Thursday in The Financial Times, which quoted the Total chief executive, Christophe de Margerie, as saying: "Today we would be taking too much political risk to invest in Iran because people will say: 'Total will do anything for money.'"
Marie said that to her knowledge there was no pressure on Total from the French or U.S. governments to end its business in Iran.
Shares of Total fell 1.6 percent in Paris morning trading. They are down 17 percent over the past 12 months.
Total's Western partners on the South Pars gas project - Royal Dutch Shell, the largest European oil company, and Repsol of Spain - pulled out in May, leaving only Total and the Malaysian state oil company Petronas.
Total's announcement came after Iranian missile tests Wednesday and Thursday that led Western leaders to express concern about the show of the country's military capabilities.
It also came after Representative Howard Berman, Democrat of California and the chairman of the House Foreign Affairs Committee, called Wednesday on Washington and Brussels to punish companies that invest in Iran.
"We've had a law on the books for a dozen years that requires such sanctions, but it never has been enforced," Bloomberg News quoted Berman as saying at a hearing on Iran in Washington. "It's time for our European allies and their corporations to cease investing in Iran."
Marie said Total would seek to return to Iran when tensions eased, though she said she could offer no timetable. "National Iranian Oil Co. is a long-term partner of Total in Iran," she said. "Our strategy has not changed."
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