Iran has signed a $4.8 billion deal with a consortium led by French oil company Total on Monday to develop its giant South Pars gas field, the largest natural gas field in the world.
The deal is the Islamic republic's first with a European oil company in more than a decade, marking a major milestone for a country whose standing as an international trade partner has hung in the balance ever since it was slapped with sanctions in 2006 amid concerns that it was developing nuclear weapons.
Total has taken a 50.1 percent interest in the South Pars project, and alongside state-owned China National Petroleum Corporation, which holds 30 percent, and Iran's Petropars (19.9 percent), will begin producing gas for the Iranian market from 2021.
Though the deal has been a slow burn, coming some 18 months after EU sanctions against the Middle Eastern nation were lifted, Iran will be hoping that it marks a new era of investor confidence and a particular boon for its dwindling oil production.
"Total's decision to sign the South Pars 11 contract is a cautiously positive sign for foreign investment in Iran's upstream," Richard Mallinson, geopolitical analyst at Energy Aspects, told CNBC via email on Monday.