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Financial Times: Shell holding Iraq oil metering talks

Shell holding Iraq oil metering talks

By Thomas Catan

Published: April 12 2006 03:00 | Last updated: April 12 2006 03:00

 

Royal Dutch Shell, the Anglo-Dutch energy group, is holding “preliminary discussions” with the Iraqi government to overhaul its oil metering system, blamed for allowing billions of dollars in revenues to be siphoned-off. 

 

BP, the UK-based energy company, was also reported to be talking to the Iraqi oil ministry about participating in the work. However, the company said it had “not signed anything” relating to the metering contract with the Iraqi government.

 

Shell and BP are already conducting separate technical work for the Iraqi oil ministry, studying the Kirkuk and Rumeila oilfields respectively. A contract to fix the metering system would help the companies increase their foothold in the country, which has the second-largest oil reserves after Saudi Arabia.

 

Shell is also conducting technical studies on the Maysan oilfield in the south of Iraq and helping the country draw up a gas “masterplan”, the company said. Like other companies, it is doing most of its work from neighbouring countries because of security concerns.

 

A watchdog led by the UN has, for two years, been calling for the installation of proper metering equipment to halt oil smuggling.

 

The International Advisory and Monitoring Board criticised the US administrator of Iraq in mid-2004 for delays in installing metering equipment to measure how much oil was being pumped.

 

However, Iraqi government officials have said the project could take another two years to complete.

 

Both Shell and BP have signed memorandums of understanding with Iraq's oil ministry to provide technical assistance to Iraq's oil ministry.

 

 

 

 

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