Total Share Discussion Threads

[waldron] 01/5/2017 21:34

International energy majors Total S.A. and BP Plc have opted not to participate in Iran's upcoming annual oil exhibition that will get underway later this week, director of public relations at the National Iranian Oil Company said Monday, Mehr News Agency reported.

"Many top-flight oil companies, including BP and Total, did not want to participate in the 22nd Iran oil exhibition this year and will only send their representatives to assess investment opportunities," Mohammad Naseri told a press briefing.

The 22nd International Oil, Gas, Refining and Petrochemical Exhibition, dubbed as the Iran Oil Show, will be held on May 6-9 in Tehran. It is the largest annual gathering in Iran's petroleum industry. BP had opted out of Tehran's new oil and gas deals over the renewed US-Iran tensions, while Total has said its future in Iran's energy market, particularly in a multibillion-dollar project in the South Pars Gas Field, hinges on sanctions relief. According to Naseri, companies from China and Germany have the biggest participation in the oil exhibit.

[the grumpy old men] 27/4/2017 15:16

Total's Profit Beats Estimates as French Giant Plans Growth
by Francois De Beaupuy
27 April 2017, 08:00 CEST 27 April 2017, 12:41 CEST

Adjusted net income jumps 56% as oil and gas output rises 4%
Company sanctions shale project in Argentina’s Vaca Muerta

Total SA posted a 56 percent increase in first-quarter profit, beating analyst estimates as crude prices rebounded and the French energy giant continued to cut costs while boosting oil and gas production.

“Good operational performance” and steadily falling production costs are allowing Total to begin new projects and acquire resources, Chief Executive Officer Patrick Pouyanne said in a statement. The company is preparing for growth by starting to develop shale resources in Argentina and expanding in Brazil, he said.
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Pouyanne is investing to exploit the decline in the cost of drilling rigs and other equipment caused by the two-year slump in crude, anticipating that the market will swing from a glut to a shortage toward the end of the decade. With crude still trading at about $50 a barrel -- half the level of 2014 -- Total is also curbing expenses to fund operations and the cash portion of its dividend without borrowing.

Adjusted first-quarter net income rose to $2.56 billion from $1.64 billion a year earlier, the company based in Courbevoie near Paris said Thursday. Analysts had expected a profit of $2.44 billion, according to the average of 13 estimates compiled by Bloomberg.

Total maintained its quarterly dividend at 62 euro cents, and kept the option for shareholders to be paid in new stock. Cash flow excluding acquisitions and asset sales was $1.7 billion after investments.

"Total free cash flow gets back to $100-a-barrel levels," Alastair Syme, an oil analyst at Citigroup Inc., said in a note. The last time free cash flow was that high, "the oil price was double the level it was in the first quarter," he said.
Shale Investment

Total said it’s given the go-ahead to a project in Argentina’s Vaca Muerta, one of the most promising shale formations outside the U.S. That’s the first of the 10 final investment decisions in new oil and gas production ventures for the coming 18 months that the company flagged in February.

“The costs are low, so it’s the right time to invest,” Pouyanne said Thursday at a conference in Paris. “Our strategy is to take advantage of this market, where you have a lot of weak players.”

Other developments that could be sanctioned in the period include Azerbaijan’s Absheron license, in which Total just increased its stake. Total recently bought interests in the Iara and Lapa fields in Brazil, and boosted its holding in an oil project in Uganda.

In Iran, the company aims to sign a gas-field development contract by summer, before making a final investment decision six months later, assuming international law allows, Pouyanne said.

In Total’s exploration and production business, adjusted net operating income more than tripled to $1.38 billion as output increased 4 percent to 2.57 million barrels of oil equivalent a day. The company reiterated plans to boost volumes by more than 4 percent this year, aided by field startups including Congo’s Moho Nord and the entry into the Al Shaheen concession in Qatar.

Refining and chemicals income fell 9 percent to $1.02 billion. Refining margins “remain favorable going into the second quarter,” the company said. It plans maintenance at facilities at Leuna, Normandy and Antwerp.

Total said this month that, together with a partner, it will invest $450 million in South Korea to increase ethylene production capacity. In March it decided to spend $1.7 billion with other investors to build a chemical plant in Texas.

Profit in the marketing and services division climbed 4 percent to $301 million. It dropped 16 percent in the gas, renewable and power unit to $61 million, hurt by an “unfavorable” solar market.
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[the grumpy old men] 27/4/2017 11:57

27/04/2017 | 12:24
TOTAL DOES NOT EXCLUDE PARTICIPATION IN SAUDI ARAMCO IPO
Saudi Aramco's stake in the Saudi Arabian oil company would be a "good investment" for Total, the CEO of the French oil group said on Thursday.

The Saudi government wants to list up to 5% of Aramco's share capital on the Ryad Stock Exchange and on at least one foreign stock exchange in the second half of 2018, an operation that is part of its plan to promote investment and diversify the market. Reducing its dependence on hydrocarbons.

The deal is likely to reach 100 billion dollars (92 billion euros), which would value the world's first oil company to some 2,000 billion dollars and would be the largest IPO ever carried out in the world.

"I'm sure it would be a good investment, as always in an IPO, because Saudi Aramco has a real business case to present," said Patrick Pouyanné, CEO of Total, at a conference on oil at Which also included Amin Nasser, the CEO of the Saudi national company.

"We will see if this is the best allocation of capital for Total," he added, pointing out however that the French group should invest considerable sums to acquire even a very small stake in Aramco.

(Benjamin Mallet, edited by Jean-Michel Bélot)

[the grumpy old men] 27/4/2017 07:47

Market info
Income soars 56% at Total in first quarter

Written by Mark Lammey - 27/04/2017 7:30 am

Total news
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French oil major Total said a strong balance sheet and cost reductions would enable it to launch new projects and buy resources after posting its first quarter results.

Total’s adjusted net income soared 56% year-on-year to $2.6billion in Q1 thanks to “good operational performance and a steadily decreasing breakeven” oil price.

Sales jumped by a quarter to $41.2billion as upstream production continued to grow by 4% per year with the start-up of the huge Moho Nord field in Congo.

The group notched $1.7billion of cash flow after investments, largely due to a strong showing from its exploration and production segment.

The firm’s producing assets include the Laggan-Tormore fields west of Shetland, which came on stream last year.

[waldron] 26/4/2017 19:55

Saudis, Russia To Discuss Oil Cuts Extension Within Two Weeks
By Tsvetana Paraskova - Apr 26, 2017, 1:32 PM CDT Crude Oil

As OPEC and non-OPEC producers seem to move closer to a consensus over extending the output cut deal beyond June, Saudi Oil Minister Khalid al-Falih will talk a possible extension with Russian Energy Minister Alexander Novak within the next two weeks and may discuss some of the issues on the phone as early as this week, Falih said on Wednesday.

“There seems to be a consensus in that direction, but we’re not 100 percent there,” al-Falih told reporters while on a visit to Azerbaijan, as quoted by Bloomberg.

“We still need to talk to all countries. A very important country to talk to, of course, is Russia, the biggest non-OPEC exporter,” al-Falih noted.

Novak and al-Falih would aim to reach some decision “that everybody has to support”, according to al-Falih.

Initial enthusiasm over OPEC’s boasting record compliance rate and assurance that the oil market would soon rebalance thanks to the output cuts has faded, as it has become evident that global oversupply is still large.

Although Russia has signaled it may be weighing a possible cut extension, it has not officially committed to joining a rollover of the cuts by the end of the year.
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Some Russian government officials have reportedly said that the country’s oil production could rise to the highest in 30 years in 2017 if the extension agreement falls through.

For now, Russia has given its broad support for an extension, although the only specific that has come from Novak so far was a comment made in March stating that it is too early to discuss the issue. The decision whether to extend the period of the cuts will depend on what the inventory situation in April will be, and what the forecasts for May and June will be, Novak has said.

Related: Saudi Arabia Thwarts Attempted Attack On Aramco Facility

However, a possible extension of the cuts would coincide with the Russian summer when production is typically rising, and Moscow agreeing to cut output at that time is not as easy.

The final decision whether to roll over the cuts is expected to be made at an OPEC meeting in Vienna on May 25.

By Tsvetana Paraskova for Oilprice.com

[waldron] 26/4/2017 14:58

Oil supermajors dig out of doldrums as cash poised to surge
By Rakteem Katakey on 4/26/2017

(Bloomberg) -- Oil majors' struggle against crude’s collapse is starting to ease, giving some companies enough cash to pay shareholders without piling on more debt.

The world’s five biggest non-state oil producers, known as the supermajors, probably increased cash from operations by a combined 67% last quarter from a year earlier, according to HSBC Bank Plc analysts Gordon Gray and Kim Fustier. That may allow some to cover dividends and capital spending without borrowing for the first time since 2012, they said.

In the past three years, Exxon Mobil Corp., Royal Dutch Shell Plc, Chevron Corp., Total SA and BP Plc have canceled billions of dollars of projects, dumped thousands of jobs and amassed towering debts to weather crude’s decline. While prices are still half their 2014 level, a partial recovery, coupled with spending cuts, contributed to “sweet-spot221; conditions in the first quarter that probably drove up earnings, according to Morgan Stanley.

The “macro environment was favorable for the majors during the first quarter,” said Martijn Rats, an analyst at Morgan Stanley in London, citing higher prices and resilient refining margins. “In addition, cost reductions are still coming through,” helping bring a “significant improvement in net income,” he said.

The five companies combined are expected to more than double first-quarter net income, according to analyst estimates compiled by Bloomberg. Chevron will return to profit while Shell’s earnings will rise to a seven-quarter high, the estimates show. Exxon, Total and BP may post their biggest profits since September 2015.

“The oil price is a big thing, but the other thing is they’ve also been helping themselves by taking operating costs out of the business,” said Jason Gammel, a London-based analyst at Jefferies International Ltd. “We are at oil-price levels where most of these companies are pretty close to covering their dividend.”

The big five oil producers also operate refineries and petrochemical plants, giving them a safety net during crude’s downturn when earnings from oil and gas production sank. Refining margins rose during the worst of the slump as the cost of the raw material -- crude oil -- fell while demand for fuels stayed strong. Margins have since narrowed but remain buoyant.

Yet doubts remain. Oil’s recovery has stalled this year as a revival in U.S. shale production threatens an attempt by the Organization of Petroleum Exporting Countries and its allies to eliminate a global oversupply. Although benchmark Brent crude rose more than 50% last year, prices are down about 9% in 2017.

Amid concern that OPEC and its partners will fail to reduce stockpiles significantly, energy companies have performed worst in the MSCI World Index this year, tumbling from pole position in 2016. After rising 44% last year, BP’s shares are down 12% in 2017, while Shell’s B shares are about 11% lower in London. Exxon has dropped 9.5%, Chevron 9.3% and Total 2.2%.

The majors won’t come roaring back until oil prices rally further, according to Alastair Syme, an analyst at Citigroup Inc.

“The sweet-spot of financial firepower -– and therefore higher returns to shareholders –- still requires significant price recovery,” Syme said in an April 19 note, downgrading both Shell and BP. While the companies have offered shareholders stock in place of cash, and implemented hefty cost cuts, they still haven’t adequately tackled the high cost of dividends, he said.

Dividend yields at Shell and BP, which fell through 2016 as crude started to recover, have risen this year, typically a signal that investors fear a cut in payouts.

BP declined to comment when contacted by email. Shell referred Bloomberg to Chief Executive Officer Ben van Beurden’s comments earlier this year, when he said free cash flow “more than covered our cash dividend” in the fourth quarter.

France’s Total will kick off the supermajors’ first-quarter earnings season on April 27, with Exxon and Chevron following the next day. BP will report on May 2 and Shell on May 4.

“You’d hope by now the cost and spending cuts start showing up in the accounts,” said Iain Armstrong, an analyst at Brewin Dolphin Ltd., which owns BP and Shell shares. “Benefits of oil prices will be a major factor and how much of that the companies have been able to capture with lower costs.”

[waldron] 26/4/2017 13:34

Agenda

27/042017
Résultats du 1er trimestre 2017

26/052017
Assemblée générale des actionnaires à 10h au Palais des Congrès de Paris


05/062017
Détachement du solde du dividende au titre de l’exercice 2016

[maywillow] 23/4/2017 16:02

Official: Total will finalize South Pars deal within weeks
Official: Total will finalize South Pars deal within weeks
Iran says it expects France's Total to finalize an agreement on the development of a key natural gas project in the south of the country in less than a month.

Iran's Deputy Oil Minister for International Affairs Amirhossein Zamani-Nia said that Total had been waiting to see whether there would be any 'positive developments' in Washington toward the renewal of sanctions against Iran before proceeding with the development of South Pars Phase 11.

"Those developments took place and Total will continue negotiating with Iran on a final agreement over the project," Zamani-Nia told ISNA.

"This will depend on how prepared Iran would be and how long it would take to write the text of the deal. I don't think it would take longer than a month."

Last November, Total signed a preliminary agreement, worth $4.8 billion to develop South Pars Phase 11 in cooperation with China's CNPC and Iran's Petropars.

Phase 11 aims to produce 1.8 billion cubic feet of gas per day for the national grid.

Total CEO and Chairman Patrick Pouyanné said in February that a final investment decision over the project hinges on whether the US would renew sanctions waivers against Iran or not.

Managing Director of National Iranian Oil Company (NIOC) Ali Kardor said in March that Total would finalize South Pars Phase 11 agreement within weeks.

"The [French] company has already allocated $15 million to this project in accordance with the first phase of the contract," Kardor was quoted as saying.

Iran has signed a flurry of deals with Western companies over the past year since the easing of international sanctions on Tehran after an accord was reached over its nuclear program.

Iran needs foreign investment for repairs and upgrading of its oil and gas fields. It also seeks the transfer of technology to its oil industry after a decade of sanctions.

Shell signed a provisional deal in December to develop Iranian oil and gas fields South Azadegan, Yadavaran and Kish in December 2016.

Iran has named 29 companies from more than a dozen countries as being allowed to bid for oil and gas projects using the new, less restrictive contract model.

The firms include Shell, France's Total, Italy's Eni, Malaysia's Petronas and Russia's Gazprom and Lukoil, as well as companies from China, Austria, Japan and other countries.

Russia's Zarubezhneft signed an MoU for a feasibility study on two joint fields in the west of the country.

Norway's International Aker Solutions Company signed an MoU to modernize Iran's oil industry.

Last May, Austria's OMV signed an MoU for projects located in the Zagros area in western Iran and the Fars field in the south.

South Korean Daewoo Engineering and Construction (Daewoo E&C) signed an MoU to construct an oil refinery in Bandar Jask, on the southern coast of Iran.

Italy's Saipem signed MoUs to cooperate on pipeline projects, upgrading of refineries and development of Tous gas field in the northeastern province of Khorasan Razavi.

Norwegian oil and gas company DNO said it was the second Western energy company after Total to sign a deal with Iran under which it agreed to study the development of the Changuleh oilfield in western Iran.

Lukoil, Russia's second biggest oil producer, hopes to reach a decision on developing two new oilfields in Iran.

Germany's Siemens AG signed an MoU in May to overhaul equipment and facilities at Iran's oil operations and refineries.

BASF's Wintershall oil and gas exploration subsidiary signed an MoU with the National Iranian Oil Company in April 2016.

[grupo guitarlumber] 13/4/2017 06:19

0
13/04/2017 | 06:22

Paris (awp / afp) - "Some shadows persist" in the first public declarations of payments from French mining companies to producer countries, say Oxfam, ONE and Sherpa non-governmental organizations in a report published on Thursday, Total and Areva.

In total, the three NGOs combed statements by six French groups - Total, Areva, EDF, Engie, Eramet and Maurel and Prom - on their raw materials extraction activities (fossil fuels or minerals) in 2015 .

An unprecedented exercise, since these companies are obliged to publish their payments to the countries where they exploit natural resources only since last year, by virtue of the transposition by France of two European directives.

While their declarations represent "a notable advance" in transparency, their understanding "remains complicated", note the NGOs.

The data are particularly difficult to access and lack context. Overall, the exchange rates used remain unclear, as do the different categories of "projects" and "beneficiaries", they criticize.

With regard to Total, the three NGOs are particularly concerned about a gap of more than 100 million dollars between the revenues declared in 2015 by the Angolan authorities coming from the main oil field of the country and the payments declared by the French group to exploit This site.

This can be explained either by a difference in the declared number of barrels of oil or by a divergence of valuation of the average price of a barrel of oil, according to them.

"It is crucial that the company disclose all the information required to understand these irregularities," said Laetitia Liebert, Director Sherpa, quoted in a joint statement by NGOs.

Regarding Areva, the NGOs believe that the group "seems far from contributing its fair share" to exploit the Nigerian uranium, despite a renegotiation of its royalty in Niger in 2014.

It is one of the poorest countries in the world, accounting for nearly 30% of Areva's uranium production, but it receives only 7% of payments from the French group to producer countries.

Areva would have paid Niger a lower royalty in 2015 compared to 2014, depriving this state of 15 million euros of revenue. Moreover, the price of exported Niger uranium would be "largely undervalued" by the local subsidiary of Areva, which would allow the group not to pay taxes on its profits in Niger, NGOs accuse.

The report makes recommendations to each of the undertakings whose declarations it has examined, as well as to the European Union and France to revise upwards the degree of transparency required.

Afp / lk

[grupo guitarlumber] 31/3/2017 13:36

According to Total Uganda’s communication manager, Marvin Kagoro, the company now owns 100% stake and will begin rebranding in Uganda, Kenya and Tanzania with immediate effect.

“The deal was closed on March 28th, with the principal assets being acquired being two logistics terminals in Mombasa, Kenya and Dar es Salaam, Tanzania, as well as a retail network of more than 100 service stations in the region,” he said during a phone interview with New Vision.

He said the acquisition will give Total a 28% market share in Uganda and about 36% market dominance in East Africa, placing them far above their closest rivals.

Reliance Industries, a subsidiary of French based Reliance Exploration & Production, owned 76% of GAPCO, while Mauritius based Fortune Oil Corporation held the remaining shares.

Kagoro said when combined with its existing operations in Kenya, Uganda and Tanzania, the new assets will strengthen Total’s logistics in the region and significantly accelerate the growth of its retail network.

“As elsewhere in Africa, where Total is the leading marketer, each station will become a community hub known for its closeness to all customers and meeting mobility and transportation needs,” he said.

Although Kagoro declined to reveal Total’s investment in the new purchase, sources within Total told New Vision the cost is estimated at slightly above $400m (sh1.44trillion).

Currently, Total operates approximately 125 fuel station across the country, and these are expected to shoot to 162 after the rebranding.

According to logistics experts, Total and Shell control nearly 50% of Ugandan’s retail fuel market distribution share, with GAPCO’s acquisition set to elevate Total into the controlling seat.
- See more at:

[grupo guitarlumber] 31/3/2017 09:39

CORRELATION


Any ideas as to when gas prices will substantially uncouple from oil prices

[sarkasm] 30/3/2017 16:37

French Total Committed to Work in Russia Despite Sanctions
© Sputnik/ Alexey Filippov
Business
17:40 30.03.2017(updated 17:42 30.03.2017) Get short URL
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French Total oil and gas company is committed to work in Russia irrespective of sanctions introduced against the country, the company's CEO Patrick Pouyanne said on Thursday.

SABETTA (Sputnik) – Earlier in the day, Pouyanne visited the northern Russian port of Sabetta to see the arrival of liquefied gas tanker Christophe de Margerie named after the former head of Total, who died in 2014.

“Christophe was the founder of our activities in Russia. That is why the company is committed to work in Russia despite the sanctions. That is a question of faith,” Pouyanne said.

Main office of French energy company Total
© Sputnik/ Alexey Filippov
Total’s Operations in Russia Unaffected by Low Oil Price
He also said that it was important for the company to see the first arrival of a liquefied gas tanker to Sabetta.

De Margerie died on the night from October 20 to October 21, 2014, when his business jet crashed in Moscow’s Vnukovo after a collision with a snow removal car. De Margerie was the only passenger on board the aircraft in addition to three French crew members, who also died in the crash.

Total is one of the partners of Russia's Novatek on the Yamal LNG Project, which involves construction of facilities to supply 16.5 million metric tonnes of LNG per year from the resource base of South Tambey in Russia's Arctic Yamal Peninsula.

[sarkasm] 30/3/2017 15:05

As oil prices falter, fears return on BP and Shell dividends

Written by Bloomberg - 30/03/2017 10:58 am

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As they guided Europe’s largest oil companies through the industry’s worst slump in two decades, the bosses of Royal Dutch Shell Plc and BP Plc had a simple message for investors: we’ll protect the dividend at all costs.

Not everyone is convinced they’ll be able to keep their word. Even after they raised billions of dollars by cutting costs, selling assets and adding debt, cash is pouring out of both companies in the form of hefty shareholder dividends. Yields on those payments — which fell through 2016 as crude started to recover — have risen this year, typically a signal that investors fear a cut in payouts.

“BP and Royal Dutch Shell have unsustainable dividends,” Neil Woodford, head of investment at Woodford Investment Management Ltd. who manages about $20 billion, wrote in a blog. “These companies are liquidating themselves rather than facing up to the need for a dividend cut. The only thing that can save them from that eventuality is a return to sustainably higher oil prices -– something that I think is very unlikely to happen.”

BP shelled out $4.6 billion in cash dividends last year, on top of $16 billion in capital spending, according to a presentation last month. It failed to generate enough cash from operations to match that outlay. Shell’s cash also fell short as project spending reached $22 billion and cash dividends $9.7 billion.
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While crude rebounded more than 50 percent in 2016, prices have since slid this year as U.S. production and inventories climb. Global benchmark Brent traded at $52.48 a barrel at 2:03 p.m. Singapore time. The price decline has weighed on the shares of Europe’s majors, with London-based BP down 9.5 percent this year and The Hague-based Shell losing 5.4 percent.

This week BP’s dividend yield — the annual return divided by the share price — rose to the highest this year. It’s now at 7.1 percent, compared with 6.2 percent at the end of 2016. Shell’s yield has risen to 6.5 percent from 5.9 percent.

Payout Priority

Dividends from Big Oil have been in the spotlight since crude’s 2014-2015 slump decimated cash and profits. Shell and BP have long deemed the payouts sacrosanct — Shell hasn’t cut its dividend since at least the Second World War — and have increased debt and sold assets to show investors that payments will be maintained. Yet some competitors have caved in.

Italian peer Eni SpA capitulated when its dividend yield was 7.2 percent, becoming the first major oil company to reduce its payout in 2015. Spain’s Repsol SA followed, cutting its final 2015 dividend when it was yielding 8.8 percent. The average yield for the U.K. benchmark FTSE 100 index is currently 3.83 percent.

Shell Chief Executive Officer Ben van Beurden said earlier this year that free cash flow “more than covered our cash dividend” in the last quarter and “there is no change in the dividend intention.” The company declined to comment beyond that statement this week.

BP also declined to comment. In February, CEO Bob Dudley said the dividend remains a top priority and BP is “sustaining and strengthening” the payout.

Investors Unconvinced

“The companies have spent a lot of time trying to convince shareholders about the dividend but not everyone believes them,” said Iain Armstrong, an analyst at Brewin Dolphin Ltd., which owns BP and Shell shares. “If and when oil goes to $60, people will really start to believe the dividend is safe.”

BP’s Dudley has spent most of his six-year tenure divesting assets, but BP went on a spending spree at the end of 2016 — taking in assets around Africa and the Middle East — which will result in a cash shortfall this year if oil stays below $60 a barrel.

Both BP and Shell have grappled with debts as they stick doggedly to their dividends. BP’s ratio of net debt to capital rose to 26.8 percent at the end of 2016 from 21.6 percent a year earlier. At Shell, additional borrowing for its $54 billion acquisition of BG Group Plc pushed the ratio to 28 percent at the end of 2016 — more than double the year-earlier level.

Total’s Confidence

Not all Europe’s oil majors are feeling the same pressure. French peer Total SA said Feb. 9 it should be able to fund operations and cash dividends at $50 a barrel this year — $5 lower than its previous estimate. It also plans to increase its dividend by 1.6 percent after reporting a 45 percent jump in fourth-quarter cash from operations. Total’s dividend yield is 5.3 percent.

While indicating increased risk, a high dividend yield can be an opportunity to lock in returns for investors confident that the companies will maintain payouts, Brewin Dolphin’s Armstrong said. For comparison, the return on U.K. benchmark 10-year bonds is 1.16 percent and on Germany’s, 0.35 percent.

During the market downturn, Shell, BP and Total have all made use of scrip dividends — offering investors payouts in shares — helping them to preserve cash as they battle to reduce debts. Yet scrip payouts dilute earnings per share and don’t necessarily rule out a dividend reduction if crude remains depressed.

“The oil majors are an unattractive investment proposition while the threat of a dividend cut hangs over them,” Woodford said.

[waldron] 27/3/2017 15:31

After years shunning Iran, Western businesses are bursting through the country's doors.

France's Peugeot and Renault SA are building cars. The U.K.'s Vodafone Group PLC is teaming up with an Iranian firm to build up network infrastructure. Major oil companies including Royal Dutch Shell PLC have signed provisional agreements to develop energy resources. And infrastructure giants, including Germany's Siemens AG, have entered into agreements for large projects.

After Iran's nuclear accord with world powers lifted a range of sanctions, many foreign investors began to push into the promising market of 80 million people, setting off skirmishes among European and Asian companies eager to gain a step on more cautious American rivals.

Peugeot Middle East chief Jean-Christophe Quemard says his company's early entry has left American competitors in the dust. "This is our opportunity to accelerate," he said in February.

U.S. companies are at risk of losing lucrative deals to early movers into the Iranian market, analysts say. But as latecomers, the companies likely won't face a learning curve in dealing with the political risks and the bureaucratic difficulties in Iran.

Apple Inc. explored entering Iran after the Obama administration allowed the export of personal communications devices in 2013, according to people familiar with the matter. But the company decided against it because of banking and legal problems, these people said. Apple declined to comment.

U.S. companies usually need special permission from the Treasury Department to do business with the country. So though the Chicago-based Boeing Co. got the go-ahead to sell 80 craft worth $16.6 billion to Iran last year, the list of American firms with significant Iranian deals is a short one.

Further complicating matters for U.S. firms: President Donald Trump threatened to rip up Iran's nuclear deal during his campaign and he hit the country with new sanctions shortly after taking office. On Sunday, Iran imposed its own sanctions on 15 American companies, mainly defense firms.

The nuclear deal removed a range of U.S., European Union and United Nations sanctions in 2016 that had held back Iranian energy exports and put the brakes on foreign investment. In exchange, Tehran agreed to curbs on its nuclear program. But while food, medicine and agricultural products are exempted from U.S. restrictions, American products are available in Iran often only through foreign subsidiaries or third-party importers.

Two of the world's biggest auto makers, Ford Motor Co. and General Motors Co., have steered clear of Iran since the nuclear deal. A spokeswoman for Ford said the company was complying with U.S. law and didn't have any business with Iran. GM is focusing "on other markets, and other opportunities," said spokesman Tony Cervone.

Meanwhile, Peugeot, officially known as Groupe PSA SA, is aiming to hit annual production of 200,000 cars in Iran by next year in conjunction with its partner Iran Khodro, after the two signed a 400 million-euro (about $430 million) joint-venture agreement in June. Already, the pace of both Peugeot's and Renault's car sales in Iran has more than doubled. In February, Renualt sold 15,230 vehicles in Iran, up 175% from a year earlier.

On a recent visit in Tehran's biggest hotels, lobbies were full of foreigners huddling with prospective Iranian partners. A packed automotive conference in February drew top executives from Peugeot, Renault and Citroën. The same day, the Swedish prime minister was visiting a Scania truck factory west of the capital following its deal to supply Iran with 1,350 buses.

Iran has caught the attention of a broad spectrum of investors beyond autos, with foreign companies selling everything from gas-powered turbines to mining technologies in the country.

Government-approved foreign direct investment shot up to more than $11 billion last year, official figures show, from $1.26 billion in 2015. Pedram Soltani, the vice president of Iran's Chamber of Commerce, said more than 200 foreign business delegations have visited Iran since the nuclear deal took effect.

"We see what's happening in the U.S. and Mr. Trump's comments," says Ghadir Ghiafe, an Iranian steel-industry executive who is exploring partnerships with South American and European companies. "Our businessmen don't pay much attention to it."

Foreign firms still face daunting obstacles to do business in Iran. Iran placed 131st out of 176 countries for corruption in a ranking by Transparency International last year. It also has major economic problems, including high unemployment and a banking system saddled with bad loans. Large international banks remain reluctant to re-establish links with Iran despite the nuclear deal. That reluctance has made transfers of money into and out of Iran a challenge.

Some large multinationals -- including major oil companies and infrastructure giants -- are keeping a close eye on the U.S. and its new president, in case sanctions snap back into place. Shell, Total SA of France and OMV of Austria have signed memorandums of understanding for deals in Iran but have yet to finalize terms.

Last month, Total Chief Executive Patrick Pouyanne said the company would wait for clarity from the Trump administration before completing a $4.8 billion investment in the country's huge South Pars offshore gas field.

But many foreign firms are finding the country's growth hard to ignore.

The International Monetary Fund recently estimated the economy grew by 7.4% in the first half of the Iranian fiscal year that ended this month, rebounding from a decline in the previous year . Meanwhile, a surge in demand has pushed consumer spending in Tehran to $5,240 per capita in 2017, up by around 11% compared with 2016, according to the London-based Planet Retail.

The upshot is even if there is demand to buy American, much of Iran's market is left to European and Asian firms.

"The market is now more diverse with Chinese cars and we realize how important it is to have satisfied customers," says Mohsen Karimi, a sales manager at Iran Khodro, a domestic auto manufacturer that has a partnership with Peugeot. Khodro had sold out its stock of cars this past year, and was now behind delivery targets for advance sales, added Mr. Karimi.

Like many Tehran residents, Alireza Aniseh wanted his first car to stand out in a streetscape filled with boxy Iranian models. The 24-year-old says he is leaning toward buying a Toyota Corolla or Camry, but his dream is owning a Ford Focus.

"Who doesn't love American cars?" he says.

--Aresu Eqbali contributed to this article.



(END) Dow Jones Newswires

March 27, 2017 05:44 ET (09:44 GMT)