French oil giant Total has signed a deal to develop a gas project in Iran.
The agreement is the first of its kind after the sanctions against the country were eased.
The oil firm has agreed with National Iranian Oil Company to develop phase 11 of South Pars (SP11), the world’s largest gas field.
The SP11 project will be developed in two phases. The first one, which has an estimated total cost of around $2 billion (£1.58bn), will consist of 30 wells and two well head platforms connected to existing onshore treatment facilities by two subsea pipelines.
A second investment phase will involve the construction of offshore compression facilities.
The field is expected to have a production capacity of 1.8 billion cubic feet of gas per day, which will be fed into Iran’s network.
Total will operate the SP11 project with a 50.1% interest alongside firm Petropars and gas company CNPC.
Patrick Pouyanné, Chairman and CEO of Total said: “Following Total’s successful development of phases 2 and 3 of South Pars in the 2000s, the Group is back to Iran to develop and produce another phase of this giant gas field.
“This project fits with the group’s strategy of expanding its presence in the Middle East, where the origins of the Group lie and growing its gas portfolio by adding low unit cost, long plateau gas assets.”