Phase 11 is to be developed by a US$2 billion JV firm, Pars LNG, which is made up of the National Iranian Oil Co, Total and Petronas.

Speaking to reporters at Iran’s Oil Show Mehdi said, “We have faced some difficulties. The price difference between dollars and euros and the increased price of steel have made contractors doubt the prices offered.”

When queried on the matter Total’s Iran representative, Francois Vatier, said, “We are discussing the commercial terms and I cannot comment more.”

The South Pars field, which is located in the Persian Gulf, sits on the world’s largest reservoir of natural gas.

In related news, Mehdi announced the timetable for wrapping up negotiations on the Bangestan field may take longer than expected.

According to the official, “BP and Total [are] considering fresh technical data on the field and [will] submit their development proposals in five or six months.”

“They wanted us to extend the deadline,” he added without elaborating further.

This announcement comes at a time when Iranian Oil Minister Bijan Zanganeh has described BP’s position on the matter as ‘problematic’, which in turn was the result of BP Plc Chief Executive John Browne stating now “the wrong time to expand in Iran”.