Total SA postpones plan to invest in Iranian gas project

"As of today, we cannot invest in Iran as we would like to," said Patricia Marie, a spokeswoman for Total in Paris, in a telephone interview. She confirmed comments by Chief Executive Officer Christophe de Margerie to the Financial Times saying the company is stepping back from a plan to develop Iranian gas reserves.

The US has intensified its push for tougher sanctions on Iran in a dispute over the country's nuclear program. Yesterday the Iranian military also test-fired a long-range Shahab-3 missile, with a 2,000-kilometer (1,240-mile) range and a one-tonne weight capable of reaching Israel, to demonstrate its power.

"It won't really have an impact on sales but it means one project less for Total's development," said Amandine Gerard, a Paris-based fund manager at Richelieu Finance, which oversees $6.2 billion, in an interview with Bloomberg Television today. She owns shares in the company.

US Defense Secretary Robert Gates said yesterday US leaders remain committed to using diplomatic and economic pressure to persuade Iran to halt its nuclear program and "are working hard to make sure" that this strategy "is the approach that continues to dominate."

Test-Firing: The chances of a military conflict between Iran and the US and its allies weren't increased by the test-firing yesterday of a Shahab-3 missile, Gates said.

"I think what we're seeing is a lot of signaling going on," Gates said during a Pentagon news conference yesterday. "I think everybody recognises what the consequences of any kind of a conflict would be."

For now, Total is putting plans on hold. "We cannot immediately invest in Iran because we would be accused of certain things," Marie said. "This does not put into question our desire to go there."

The French energy group believes Iran to be "too risky" and is unlikely, in the short term, to invest in a liquefied gas project in the Iranian South Pars gas field, the FT reported. Total had planned to develop phase 11 of the field with Malaysia-based Petronas Gas Bhd., the newspaper said.