By Nayla Razzouk – Nov 15, 2011 12:16 PM GMT
Iraqs cabinet approved a $17 billion contract with Royal Dutch Shell Plc (RDSA) and Mitsubishi Corp. (8058) for the capture of natural gas at three oil fields in the south of the country, a government spokesman said.
The government has a 51 percent stake in the partnership, and the companies 49 percent, including 44 percent for Shell and the rest for Mitsubishi, Ali Al-Dabbagh said today by telephone from Baghdad. The agreement is for 25 years.
Shell, Europes largest oil company, has been in talks with the government since 2008 to set up the venture to gather gas that is currently flared off and wasted. Iraq holds the fifth- biggest natural-gas reserves in the Middle East and is struggling to restore capacity for power generation after years of conflict and economic sanctions. Associated gas, once captured, would help feed power stations and overcome electricity shortages.
Iraq has signed 15 licenses for the development of energy resources, including three for gas, since 2008, five years after the U.S.-led invasion of the nation.
To contact the reporter on this story: Nayla Razzouk in Amman at [email protected]
To contact the editor responsible for this story: Shaji Mathew at [email protected]
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