Ready for US face-off, China ‘re-engages’ Iran on projects

China has “re-engaged” Iran on three key energy projects which the world’s biggest oil buyer is adamant to carry on with their implementation despite US sanctions, a report says.

The international energy website OilPrice.com quoted a senior source working closely with Iran’s Ministry of Petroleum as saying that Phase 11 of the supergiant South Pars gas field, Yadavaran oil field and the Jask oil export terminal are the three projects which the Chinese want to continue.

Head of the Pars Oil and Gas Company (POGC) Mohammad Meshkinfam said last week talks had resumed with Chinese developers to advance Phase 11.

China National Petroleum Corp (CNPC) became the dominant investor in Phase 11 after France’s Total withdrew from the project last summer under increasing pressure from the United States.

Last December, Reuters said CNPC had decided to suspend investment in the South Pars project, but Minister of Petroleum Bijan Zangeneh said Iran had rejected it.

“We have to sort out the issue with this country (China). It has to pull out of the contract which if it does so, its share will be transferred to Iran’s Petropars,” the minister said.

The National Iranian Oil Company (NIOC) had awarded the project in July 2017 to a consortium comprising Total, CNPC and Petropars through a contract worth more than $4 billion.

When Total withdrew, CNPC was assigned the French firm’s 50.1 percent stake in the field, giving it a total of 80.1 percent in the site, with Iran’s Petropars holding the remainder.

When the US reimposed sanctions on Iran’s energy sector in November, China saw a chance for a trade-off with the United States.

SS