French energy giant opts out of Iran

Total pulls out of liquefied natural gas project, describing situation in Iran as too politically risky.

totlal gas field 224.88 (photo credit: AP)
totlal gas field 224.88
(photo credit: AP)
The French oil and gas giant Total said that it will not invest in an Iranian gas field, describing the situation there as too politically risky, the company's CEO told the Financial Times. The company was considering investing in a liquefied natural gas project in Iran and was the last major Western oil company mulling such an investment there. Total will be the third European company to opt out of the scheme after Royal Dutch Shell and Spain's Repsol decided not to invest in the project, but those two companies said they may join later stages of the field's development. The decision means Iran is unlikely to be able to raise its gas exports until late next decade. "Today we would be taking too much political risk to invest in Iran because people will say, 'Total will do anything for money,'" the firm's CEO, Cristophe de Margerie, said. Analysts said the decision would deal a blow to Iran's energy industry. Iran is under heavy international pressure to abandon its controversial nuclear program, for fear it is covertly manufacturing a nuclear bomb. The country has come under several sets of international economic sanctions. Total's announcement comes as tension is on the rise between Iran and Western countries, especially the United States and Israel. The two sides have been exchanging verbal threats and recent drills in the Gulf region have sparked speculation that a military strike against Iran's nuclear facilities is being planned. Iran has defied international demands to suspend its uranium-enrichment activities and maintains its right to possess nuclear technology. The oil-rich country insists its nuclear program is for peaceful uses of creating energy.