* EDF, Total to go ahead with LNG project in Dunkirk-Sarkozy
* Project involves $2.2 bln investment, would employ 1,200
* Terminal would meet 20 pct of France's natural gas needs
* Sarkozy gives no timeframe, project already delayed
(Adds Sarkozy on EDF's shareholding)
GRAVELINES, France, May 3 (Reuters) - President Nicolas Sarkozy said on Tuesday that a promised liquefied natural gas terminal in northern France would be built despite delays that had cast doubts on the project.
"I had promised in Dunkirk that we would make a major investment, so today I'll take the opportunity to confirm the development of the LNG terminal," Sarkozy said during a visit to the Gravelines nuclear power plant.
EDF, which runs all of France's nuclear power plants, confirmed the investment amounted to more than 1.5 billion euros ($2.2 billion). EDF is 84.5 percent state-owned.
The LNG terminal in Dunkirk would have a regasification capacity of 10-13 billion cubic meters per year, would meet 20 percent of France's natural gas demand and employ 1,200 people during construction and 50 when in operation.
The project comes at a time when a boom in U.S. shale gas production and a mushrooming of LNG projects around the world have led to a global glut, and while weak economic growth has capped demand, pushing gas prices sharply lower.
The investment decision originally had been expected by the end of 2010. Last June, former Industry Minister Christian Estrosi said EDF and partner Total were aiming to start production on the site by 2014.
Total, France's biggest company by market value, signed an agreement with EDF to invest in the Dunkirk project after closing a low-margin refinery in the region, causing public and political uproar.
Total Chief Executive Christophe de Margerie, who accompanied Sarkozy and EDF CEO Henri Proglio on the Gravelines visit, confirmed his group would hold a 10 percent stake.
Sarkozy also confirmed he wanted EDF, which meets nearly 80 percent of France's power needs, to remain publically held.
"I believe in the need for the state to remain the EDF shareholder," Sarkozy said.
The comment came after Japan's Fukushima nuclear disaster spurred a debate on nuclear safety in France, the world's most nuclear-dependent country with 58 reactors.
Sarkozy had repeatedly said the government would keep former state monopolies EDF and Gaz de France in its hands. But in 2008, he agreed to marry Gaz de France with private investor-controlled Suez, which diluted the state's majority stake to 35 percent.
(Reporting by Emmanuel Jarry; Writing by Marie Maitre, editing by Jane Baird)