UPDATE 1-Total CEO sees short-term Iran South Pars problems

Mon May 12, 2008 7:31am EDT

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(Adds comments from Total CEO on Iran)

DOHA/PARIS May 12 (Reuters) - French oil major Total (TOTF.PA) said on Monday it was still interested in Iran's huge South Pars gas field but added it could be hard to reach an agreement in the short term.

Total Chief Executive Christophe De Margerie, speaking in Doha on Monday, told reporters: "In the short term, it will be difficult to find a win-win situation. We have told them we are interested in the long term."

He said Total and Iran still have to discuss the terms of the contract, because of rising costs.

The South Pars project is racked with political pitfalls for foreign oil companies, due to concerns over Iran's nuclear programme.

This month, rival Royal Dutch Shell (RDSa.L) said it would pull out of developing another phase of the South Pars project.

Total has a memorandum of understanding with state-owned National Iranian Oil Company to develop Phase 11 of the South Pars field.

Iran has said it wants Total to commit to the deal by mid-year but the French government, concerned about Iran's nuclear programme, has urged Total not to invest.

The U.S. and European nations fear Iran's nuclear programme is aimed at developing weapons, a claim Tehran denies.

Shell had also come under pressure over South Pars from U.S. lawmakers concerned by the nuclear programme.

A Shell spokeswoman said on May 10 that it was pulling out of the Phase 13 part of South Pars but could join later stages of the field's development.

For more on De Margerie's comments, see [ID:nL12535316].

(Reporting by Simon Webb and Sudip Kar-Gupta; Editing by Quentin Bryar and David Hulmes)

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