Iraq to Exploit Gas from Southern Oilfield
Source: Xinhua News Agency (6/29/10)
"Shell/Mitsubishi JV to exploit byproduct nat gas in S. Iraq oilfields."
The deal is designed to exploit the natural gas in the Basra region that currently being burned off at three oilfields of Rumaila, Zubair and West Qurna Phase One, with a target to export 600 million cubic feet per day, Ali al-Dabbagh said in a statement.
According to the deal, the Iraqi government will hold 51% of the venture's share, and Shell will have 44% while the Mitsubishi Corp. will keep 5%, Dabbagh said without giving a date for the final signing.
Iraq has proven reserves of 112 trillion cubic feet of natural gas, but because of the poor infrastructure of the oil and gas industries, the country is only producing 1.5 billion cubic feet a day. Shell has already signed contracts with the Iraqi government to develop supergiant oilfields of Majnoon and West Qurna Phase One in the southern province of Maysan. Shell's oil contracts were part of 10 contracts signed with the Iraqi government to develop 10 oilfields in two auctions last year that aimed at giving the country the potential to increase its oil output capacity, which is currently at roughly 2.5 million barrel per day (bpd), to be 12 million bpd in six or seven years. Iraq mainly depends on oil revenues as the country has the world's third-largest proven oil reserves estimated at 115 billion barrels, following Saudi Arabia and Iran.