Wednesday 16 November 2011

Iraq Government signs $17bn deal with Shell

Iraq's cabinet has reportedly approved a $17 billion (£10.7bn) contract with Royal Dutch Shell and Mitsubishi Corporation. The deal aims to capture natural gas, wasted from flaring at three oil fields, which Shell says could be used for export.

According to Shell 700 million cubic feet of gas is burnt off each day in southern Iraq, which is worth $1.8 billion per year, because the infrastructure isn't in place yet. Peter Voser, Chief Executive Officerat Shell said: "Capturing this gas will create a reliable supply of energy for Iraq while at the same time reducing greenhouse-gas emissions. This also sends a positive signal about the investment climate in the country."

Iraq's South Gas Company will hold a 51% stake in the joint venture, 44% by Shell and 5% by Mitsubishi Corporation.