French oil major Total may turn its back on its $1bn (£740m) Iranian gas project within six months unless it can clinch a sanctions waiver for the project from the US government.

The French state-backed oil group said that without an exemption from the US it would halt work at the world’s largest gas field and wind down all its activities by November 4.

The US decision to withdraw from the nuclear deal between Iran and an alliance of western powers was taken earlier this month, despite opposition from France, Germany and the UK, and threatens a huge swathe of international business deals.

Total said it could not afford to breach the looming US sanctions against Iran due to its reliance on American banks and shareholders.

The oil company said US institutions were involved in 90pc of its financing operations, and make up 30pc of its shareholder base. In addition, the company operates US energy assets that amount to $10bn in spending.

“Total has always been clear that it cannot afford to be exposed to any secondary sanction which might include the loss of financing in dollars by US banks for its worldwide operations,” the group said.

Iran nuclear deal | The sanctions explained

Total was one of the first energy companies to return to Iran after UN sanctions against the country lifted in early 2016, despite its exposure to Iranian sanctions in the 1990s, which also required a US waiver to avoid losing its investments.

The group signed a deal to take a 50pc stake in the South Pars field development, which will cost a total of $2bn. The other stakeholders include Chinese state-owned oil and gas company CNPC, which holds 30pc, and Iranian state-owned Petropars, which holds 20pc.

Total says that it has spent less than €40m (£34.5m) on the South Pars project, and that pulling out of it would not affect its general production growth targets.

The sanctions also threaten to embroil BP, which is hoping to sell the Rhum North Sea field, jointly owned with the Iranian Oil Company, to Serica Energy.

The gas field was forced to close for almost three years following US-EU sanctions against Iran in 2010, before securing a waiver to allow the field’s gas flows to restart.

Industry experts believe BP will seek the same route again once more detail emerges over the US crackdown on Iran later this year.

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