Total steps back from investing in Iran
By Carola Hoyos in London and Daniel Dombey in Washington
Published: July 9 2008 23:34 | Last updated: July 9 2008 23:34
Iran has lost the last major western energy group that had been considering making a significant investment to develop the countrys huge gas reserves in a victory for Washingtons efforts to isolate Tehran over its nuclear ambitions.
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 Irans South Pars gas field in near future.
The comments from Christophe de Margerie, chief executive, follow weeks of increasing tensions between Iran and Israel. On Wednesday, Tehran test-fired nine missiles and warned that it would provide massive retaliation to any military strike.
The US has also stepped up its push to impose tougher sanctions on Tehran in the dispute over Irans nuclear programme.
Mr de Margerie said: Today we would be taking too much political risk to invest in Iran because people will say: Total will do anything for money.
Together with Malaysias 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 Mays announcement that Royal Dutch Shell andRepsol YPF of Spain would pull out of Phase 13, Total was left exposed.
Totals 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 Totals decision a death blow for Irans LNG ambitions, because the country would now be unable to gain the knowhow 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 Irans massive hydrocarbon reserves. Shell and Repsol said they could still join later stages of the development of the field.
In a further sign of the increased scrutiny over investments in Irans energy sector, William Burns, the US state departments top official on Iran, told a US congressional committee on Wednesday that Washington would conduct a serious review to see whether the Norwegian group StatoilHydro had violated US law by carrying out a large investment in Iran.
Washington had been particularly worried about Total, and US officials concede measures affecting the transfer of western investment and knowhow to Irans energy sector have a much greater impact than do financial sanctions. But Mr de Margerie voiced his anger at the policy, saying: You take two major countries [Iran and Iraq] out of the system and then you say: There is not enough oil and gas. Oh no, surprise, surprise.
Wednesdays test firing left the oil market unfazed, with oil prices failing to make up recent losses and trading at $136.20 a barrel.
EDITORS CHOICE
Iran test-fires missile in the Gulf – Jul-09
In depth: Iran – Nov-04
Graphic: What is at stake in Iran – Jul-03
Critics say Iran oil mafia a myth – Jul-08
Fear over Israels threat to strike Iran – Jul-02
Copyright The Financial Times Limited 2008
Royal Dutch Shell conspired directly with Hitler, financed the Nazi Party, was anti-Semitic and sold out its own Dutch Jewish employees to the Nazis. Shell had a close relationship with the Nazis during and after the reign of Sir Henri Deterding, an ardent Nazi, and the founder and decades long leader of the Royal Dutch Shell Group. His burial ceremony, which had all the trappings of a state funeral, was held at his private estate in Mecklenburg, Germany. The spectacle (photographs below) included a funeral procession led by a horse drawn funeral hearse with senior Nazis officials and senior Royal Dutch Shell directors in attendance, Nazi salutes at the graveside, swastika banners on display and wreaths and personal tributes from Adolf Hitler and Reichsmarschall, Hermann Goring. Deterding was an honored associate and supporter of Hitler and a personal friend of Goring.
Deterding was the guest of Hitler during a four day summit meeting at Berchtesgaden. Sir Henri and Hitler both had ambitions on Russian oil fields. Only an honored personal guest would be rewarded with a private four day meeting at Hitler’s mountain top retreat.
IN JULY 2007, MR BILL CAMPBELL (ABOVE, A RETIRED GROUP AUDITOR OF SHELL INTERNATIONAL SENT AN EMAIL TO EVERY UK MP AND MEMBER OF THE HOUSE OF LORDS: 
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A head-cut image of Alfred Donovan (now deceased) appears courtesy of The Wall Street Journal.
