CNPC took over in 2009 at South Pars Phase 11 after French energy company Total and its Malaysian counterpart Petronas failed to live up to the terms of their contractual obligations for development.
Iran announced the National Iranian Oil co. signed a $5 billion buy-back deal with domestic Petropars Ltd. for Phase 11, state-funded broadcaster Press TV reported Monday. The report said the decision was made because CNPC was dragging its feet at Phase 11.
Petropars said it plans to drill 12 wells for Phase 11 with the goal of producing 2 billion cubic feet per day. No timeline for development was offered.
The announcement came as Iran said it was ready to work with potential international partners to develop an energy sector handicapped by Western sanctions. Sanctions are designed to rob Iran of oil and gas revenue used to fund a controversial nuclear program, which Iran says is for peaceful purposes.
The U.S. Energy Information Administration reports South Pars holds 325 trillion cubic feet of natural gas, which represents approximately a quarter of Iran's total proved natural gas reserves.