Renewables investment group Quercus has reached an agreement with Iran’s Ministry of Energy for the phased development, construction and operation of a 600MW solar plant in Iran.

The deal, worth more than €500m ($585m), is Quercus’ first investment outside Europe and represents the largest single investment in Iran’s renewables sector since the lifting of international sanctions.

Construction is due to commence in 2018. The project will take three years to complete with around 100MW becoming operational every six months. Once completed the 600MW plant will be one of the largest in the world.

Quercus said it is venturing into the Iranian market following significant interest from existing and potential investors, adding that European energy investors remain enthusiastic about prospects in the country, despite renewed tensions with the US.

Iran’s well-advanced plans to install 5GW of renewable energy by 2020 has been undermined by the US Trump administration, which has raised questions over Iran’s compliance with the January 2016 agreement to lift international sanctions.

Quercus, which has built a 40-plant portfolio mainly in the UK and Italy, will create a new specialist team for the delivery of the project.

International law firm Dentons Europe advised Quercus on the deal and represented the company in negotiations with the Iranian energy ministry.