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French oil major Total has halted plans to help develop Iran's giant South Pars gas field as it seeks to clarify whether the investment can avoid falling foul of returning US sanctions on Tehran, the oil company said Wednesday.

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Total was the furthest advanced of its European oil major peers in a cautious feeling out of upstream opportunities in Iran since the easing of international sanctions at the start of 2016.

Persian Gulf gas field giant

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 US to pull out of the international nuclear deal with Iran and re-impose sanctions on the country.

"Total has always been clear that it cannot afford to be exposed to any secondary sanction, which might include the loss of financing in dollars by US banks for its worldwide operations, the loss of its US shareholders or the inability to continue its US operations," Total said in a statement.

US banks are involved in more than 90% of Total?s financing operations, Total said, adding that US assets represent more than $10 billion of capital employed and that 30% of its shareholders are in the US.

South Pars phase 11 development is aimed initially at domestic gas demand. Due on stream in 2021, the project should also yield around 70,000 b/d of condensate production.

Total also confirmed it is lobbying authorities in both Paris and Washington for a waiver to the US sanctions which are due to come into effect November 5.

The company also confirmed its 5%/year average production growth target between 2016 and 2022, noting "various growth opportunities which have been captured by Total in recent months."Total also said its actual investment to date with respect to the south Pars contract is less than Eur40 million.

The total project, which also involves China 's CNPC and Iranian company Petropars, is estimated to be around $2 billion for the first phase.

--Robert Perkins, robert.perkins@spglobal.com

--Edited by Jeremy Lovell, jeremy.lovell@spglobal.com