Oil companies have been forced to reassess their investment plans in the OPEC producer, however, in the wake of the May 8 move by the USA to pull out of the global nuclear deal with Iran and re-impose sanctions on the country.
These renewed sanctions imposed by President Trump have left some major European companies in a quandary as to what to do with their business operations.
As a outcome, "Complete is not going to be able to proceed the SP11 challenge and should unwind all related operations earlier than four November 2018 except Complete is granted a selected challenge waiver by the USA authorities with the assist of the French and European authorities", the French firm mentioned in a press release.
The group said it has $10 billion of capital employed in its United States assets, and USA banks are involved in 90 percent of its financing operations, making Total highly vulnerable if targeted by any U.S. actions. The rest of the project is under the ownership of the Iranian state energy company.
However, officials with the company state that they will have to walk away from the project if they are not exempted from the new USA sanctions.
Supporters of the deal, which lifted earlier sanctions on the Islamic Republic in exchange for it curbing its nuclear ambitions, need to find a way to reassure companies that their investments are beyond Washington's extra-territorial reach.
Total entered into a three-way agreement to develop the South Pars area in Iran for oil and gas exploration. France, Germany and Britain are leading a European effort to safeguard Europe's economic interests but have few options that pose any threat to the United States.
Total said it had spent less than $47m on the Iran project so far and that pulling out would not affect the company's production growth targets.
"It would be suicide to do any new business or funding for Iran or Iran-related companies without explicit guarantees from the U.S. government".
Total said it will unwind operations by November unless sanctions are waived. Joe Kaesar, the CEO of Germany's Siemens, told CNN his company would not be able to do any new business with Tehran.
Background: Despite the US withdrawal, Iranian Foreign Minister Javad Zarif met with European Union leaders on May 15 to discuss how to circumvent USA sanctions in an effort to salvage the nuclear deal.