Iran says Chinese state oil firm withdraws from $5B deal

Iran says Chinese state oil firm withdraws from $5B deal

Iran says Chinese state oil firm withdraws from $5B deal

Speaking to the press on the same day, the official emphasized that Iran wants positive ties with all the countries in the region, adding that China's national petroleum company had pulled out of developing phase 11 of the country's giant South Pars gas field.

Iranian Oil Minister Bijan Namdar Zanganeh said on Sunday that Iran will use any possible way to export its oil, stressing that exporting crude was the country's legitimate right.

The increasing U.S. pressure on Iran has scared away foreign investors from doing business in the country. TOTAL pulled of the deal immediately after the USA withdrawal from the 2015 nuclear agreement in 2018, but CNPC's continued participation had remained unclear.

The development, announced by Zanganeh on the ministry's SHANA website, comes amid economic pressure on both Iran and China from the United States.

Iran has the world's second-largest reserves of natural gas, but it has not yet become a major exporter because of global sanctions imposed on the country for decades.

The China National Petroleum Corporation (CNPC) became the dominant investor in plans for the expansion of South Pars, the world's largest gas field, after France's Total withdrew from the project in August 2018. Under the initial terms of the arrangement, France's Total was to have a 50.1 % stake, with China's CNPC getting 30 % and Iran's Petropars organization having a 19.9 % stake. Iran cancelled another CNPC contract in 2012 amid increasing global sanctions which led to the 2015 nuclear deal.

After withdrawing from the nuclear deal with Tehran over a year ago, the US imposed sanctions on Iran that have kept it from selling its oil overseas and have crippled its economy. In late September, the USA sanctioned Chinese shipping firms it said were ferrying Iranian crude oil.

There also have been a series of attacks across the Middle East that the US blames on Iran. "I have no problem to meet with Saudi Arabia's oil minister", Zanganeh said.

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