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PARIS (Reuters) - French oil major Total said on Monday it had signed a contract with Iran to develop the giant South Pars gas field, marking the first major Western energy investment since sanctions against Tehran were lifted.
Total and the National Iranian Oil Company (NIOC) signed a deal to develop phase of 11 of South Pars, which is the world's largest gas field.
The project will have a production capacity of 2 billion cubic feet per day or 400,000 barrels of oil equivalent per day including condensate, said Total, which also said the produced gas will supply the Iranian domestic market starting in 2021.
The first phase of the South Pars gas field development will cost around $2 billion dollars, Total added.
"This is a major agreement for Total, which officially marks our return to Iran to open a new page in the history of our partnership with the country," said Total Chairman and Chief Executive Patrick Pouyanne in a statement.
Reporting by Sudip Kar-Gupta in Paris, and Manon Jacob, Alan Charlish and Michal Aleksandrowicz in Gdynia; Editing by Bate Felix