Iran has lost the last major western energy group that had been considering making a significant investment to develop the country's huge gas reserves in a victory for Washington's efforts to isolate Tehran over its nuclear ambitions, the Financial Times reported on its Web site Thursday.
Total, the French energy group, told the FT it was now too risky to invest in Iran, making it highly unlikely that the group will invest in a liquefied natural gas project linked to Iran's South Pars gas field in the near future.
The comments from Christophe de Margerie, chief executive, follow weeks of increasing tensions between Iran and Israel, said the report.
"Today we would be taking too much political risk to invest in Iran because people will say: 'Total will do anything for money'," the report quoted De Margerie as saying.
Together with Malaysia's Petronas, Total was due to develop phase 11 of the South Pars field and had until Wednesday maintained it had not decided to drop its interest in the project. After May's announcement that Royal Dutch Shell (RDSB) and Repsol YPF (REP) of Spain would pull out of Phase 13, Total was left exposed, the report said.
The report said Total's move is a big blow for Iran, which is now unlikely to be able to significantly raise its gas exports until late in the next decade at the soonest. Samuel Ciszuk, Middle East energy analyst at Global Insight, called Total's decision "a death blow" for Iran's LNG ambitions, because the country would now be unable to gain the know-how it needed for such complex projects, even if it teamed up with Russia or China.
None of the western oil companies including Total is willing definitively to close the door on Iran's massive hydrocarbon reserves. Shell and Repsol said they could still join later stages of the development of the field, said the report.