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From Euro-Burmanet (Paris) re TOTAL (r)



Subject: From Euro-Burmanet (Paris) re TOTAL and US Sanctions (Iran, Libya)

Paris -- French national newspapers, as well as the economic press here rep=
orted presidential decision on U.S. sanctions against Libya and Iran with l=
eading front-page stories followed immediately with full page (Le Monde) an=
d double page (Liberation) articles. Le Monde's story titled " L'Europe men=
ace Washington de repr=E9sailles commerciales ", shouts back defiantly agai=
nst the american legislation, and incredulously boasts about the French pre=
ss being "strongly congratulated " by the Iranian press "over the hostile a=
nd unanimous reaction of the Europeans ". Le Monde follows its story with a=
 less than detailed report of European business investment in Libya and Ira=
n. However, apart from the hysterical raving about retailations and counter=
-measures, it eventually gets to the story of TOTAL's situation. (TOTAL is =
an active advertiser in both Le Monde and Liberation). =


Le Monde reports that the french oil company signed last July 1995 a $600 m=
illion contact for development of the Sirri A and E fields, after the ameri=
can company Conoco was forced to abandon its investment there owing to the =
embargo. Work had only just begun on the fields a few weeks ago, with produ=
ction to start in 1998, reports Le Monde. =


Last February, TOTAL Ceo Thierry Desmarest, rejected the argument that TOTA=
L " took the place of Conoco ", saying, " We had been in negotiation with t=
he Iranians long before that, around four to five years before, but the ame=
ricans abandoned because of the US embargo. " When we sigtned, TOTAL respec=
ted all outstanding international and french legislation. "

Liberation (August 6 1996), quite to the contrary of Le Monde, shows Presid=
ent Clinton in a favorable light, with a front page photo of the president =
signing the legislation under the headline "Terrorism : Europe revolts agai=
nst Clinton. America wants to hit hard companies investing in Iran and Liby=
a.On the inside story, page 2-3, a proudly principled and defiant Mr. Clint=
on is pictured in a half-page photo giving the military salute to students =
against  a backdrop " The George Washington University, Washington D.C.. Th=
e photo caption reads, "The american president affirmed that the United Sta=
tes is a country where not just anything goes. " =


The Liberation story clearly signels out TOTAL as target of the U.S. sancti=
ons (" TOTAL finds itself on the front line ; the french company recently i=
nvested in Iran and Libya "). The story is accompanied by a page 2 editoria=
l by Pierre Briancon, if not favorable to the call for sanctions, certainly=
 not hostile and most critical of the failure of Europeans to come up with =
a feasible alternative while having more than enough time to do it


TOTAL's investment is described in detail, contract signed July 1995, the s=
ole foreign investor to have renewed business with Iran since the fall of t=
he Shah in 1979. Production estimated to begin in 1998 at 120,000 barrels p=
er day, with 485 million barrels in reserve deposits. " A return to the sou=
rce by the company that was orginally created to expoit persian oil ". The =
deal is expected to bring to Iran more than $10 billion (60 billion francs)=
 and $600 million (3,6 milliards francs) from gaz deposits. In fact, last M=
arch 1995, Conoco won the Iran contract but had to renounce it over the US =
embargo at that time. Shell, interested in the fields there, also abandoned=
 over the embargo. Undeterred at the time, the French went in alone.  In Li=
bya, TOTAL operates the Mabruk fields, beginning production in February 199=
5, extracting 10 000 barrels per day, then  finding a partner in the Norweg=
ian company Saga. And so on and so on.

Lib=E9 cites TOTAL's business in the United States at 15,6 billion francs (=
roughly a little more than $3 billion), representing 11% of TOTAL's  combin=
ed sales from drilling, refineries, and sales of gaz. TOTAL US also has a h=
uge distribution network of some 2 000 service stations.

Meanwhile, TOTAL claims the US sanctions laws are not retroactive, and anti=
cipates European Union and French government intervention to protect their =
investments.

Lib=E9 also cites the following figures : 90% of Irans foreign earnings com=
es from sales of its hydrocarbon ressources. Iran produces 3.6 millions of =
barrels a day.

20 % of European oil comes from Libya and Iran

8.1  billion francs ($1.2 billion) , 1995 German exports to Iran, an 2.8 bi=
llion francs for France

7.1 billion frances of Iranian imports to France(90% oil). Iran is the 49 t=
h ranking buyer and 29th ranking seller to France.