French energy giant Total is reportedly in talks with Iran to buy a major stake in one of the country’s main liquefied natural gas (LNG) projects.
Reuters quoted several sources with knowledge of the matter as saying that the project in which Total was considering to invest was Iran LNG.
The move, it said, would enable the company to unlock vast gas reserves in Iran.
Total – the first of its peers to strike deals in Iran after sanctions – seeks entry into Iran LNG at a discount to the pre-sanctions price in exchange for reviving the stalled project, the report said.
Reuters added that Total was in the running for a stake in Iran LNG, alongside several other oil majors, but any deal was still some way off.
"Iran is trying to revamp its oil and gas projects and the abandoned LNG plant is one of them," the news service quoted an unidentified source as saying.
An Iranian industry source with ties to Iran LNG told Reuters that Total had moved several employees to the firm's offices in Tehran last year as part of the discussions.
Work on the 10.8 million-tons-per-annum (mtpa) plant hit a wall in 2012 when sanctions stopped Iran from bringing in specialist liquefaction technology from German contractor Linde.
At issue are reimbursements demanded by Linde for the cost of storing Iran LNG's liquefaction train, or production line, during the sanction years, industry sources said.
"Equipment was finished for the first production line (or train) of 5.4 mtpa, and about half finished for the second one," a second Iranian gas industry source told Reuters.
With $2.3 billion invested so far, Iran LNG is more than half-built with two storage tanks, a jetty and power plant, sources said – but total costs to bring the plant on-stream may be as high as $10 billion.