Wall Street Journal Online & Arab Oil & Gas News & Reuters – 2011-11-30 01:02:21
http://online.wsj.com/article/BT-CO-20111127-706700.html
Iraq Signs Final $17.2 Billion Shell Gas Deal
Wall Street Journal Online
BASRA (November 27, 2011) — Iraq Sunday signed the final $17.2 billion deal with Royal Dutch Shell PLC (RDSA) and Mitsubishi Corp. (8058.TO) to capture and process flared gas from southern Iraqi oil fields, Iraqi and company officials said.
The 25-year contract is one of biggest signed by Iraq in past two years.
The joint venture is expected to help generate electric power in Iraq.
Any gas produced that isn’t needed in Iraq can be exported.
Iraq Signs Final $17.2 Billion Shell Gas Deal
Arab Oil & Gas News
(November 29, 2011) — Iraq signed a final USD 17 billion deal with Royal Dutch Shell and Mitsubishi on Sunday to capture flared gas at southern oilfields, a project that should boost production of badly needed electricity. The 25-year deal, one of the largest Iraq has signed with foreign energy companies, is meant to help harness more than 700 million cubic feet per day of gas being burned off at southern fields.
The long-awaited deal was completed at a signing ceremony in Baghdad attended by Iraqi Oil Minister Abdul-Kareem Luaibi and Shell Chief Executive Peter Voser. “This day represents a historical change in the Iraqi oil industry, represented by the best utilisation of the (associated) gas to meet the increasing needs for gas in Iraq,” Luaibi said at the ceremony.
OPEC member Iraq has signed a series of deals with foreign oil companies to modernise its energy industry after years of war and economic sanctions. Increased oil production is expected to bring huge increases in associated gas output and Iraq may soon produce more gas than it can use, opening up the possibility of gas exports.
The Shell deal will involve the creation of the Basra Gas Co joint venture, in which the government will hold 51%, Shell 44% and Mitsubishi 5%. The project aims to capture gas at Iraq’s workhorse field, Rumaila, as well as Zubair and West Qurna. Intermittent electricity is one of Iraqis’ major complaints against their government. Power supply is about half of demand.
Iraq Signs Final $17.2 Billion Royal Dutch Shell Plc And Mitsubishi Corporation Gas Deal
Reuters
(November 27, 2011) — Dow Jones reported that Iraq on Sunday signed the final $17.2 billion deal with Royal Dutch Shell Plc and Mitsubishi Corporation to capture and process flared gas from southern Iraqi oil fields, Iraqi and company officials said. The joint venture (JV), which includes Iraqi state South Gas Co., is expected to help Iraq make use of more than 700 million cubic feet a day of gas that is being burned and help generate much-needed electric power.
The 25-year contract has signed with international energy companies over the past two years as the country rebuilds its oil and gas industry after years of sanctions and war followed by the U.S.-led invasion in 2003 that ousted Saddam Hussein.
The deal creates the Basra Gas Co. JV, made up of Iraq’s state South Gas Co., which holds 51% of the venture, Shell, which has 44%, and Mitsubishi, which holds the remaining 5%. It will collect raw associate gas from three supergiant Iraqi oil fields Rumaila, Zubair and West Qurna phase 1 in southern Iraq, and process that gas into valuable products, initially for sale domestically in Iraq.
