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Iraq, Shell Resolve Last Obstacle To $12 Bln Gas Deal

The Iraqi Oil Ministry and Royal Dutch Shell PLC (RDSB) have resolved the last obstacle that was preventing them from signing a long-awaited $12 billion joint-venture deal, a senior Iraqi oil official said Tuesday.
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Τρι, 29 Μαρτίου 2011 - 18:00
The Iraqi Oil Ministry and Royal Dutch Shell PLC (RDSB) have resolved the last obstacle that was preventing them from signing a long-awaited $12 billion joint-venture deal, a senior Iraqi oil official said Tuesday.

The main dispute was over the rights of export. Shell, along with its partner Japan 's Mitsubishi Corp. (8058.TO), wanted to handle export, while under current Iraqi hydrocarbon law; the Iraqi State Oil Marketing Organization, or SOMO, should do so.

"The issue is nearly solved," Ali H. Khudhier, head of the state-run South Gas Company told Dow Jones Newswires in an interview in his office in Zubair, south of Basra .

"Shell wanted to handle export, but now it is agreed that SOMO would handle export," he said. Shell, however, has asked for further discussions, he said.

Last week, the energy committee at the Iraqi council of ministers asked the Oil Ministry to review the Shell draft deal which aims at capturing and exploiting millions of cubic feet a day of gas flared from four supergiant oil fields near Basra .

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