Iraq cabinet approves US$17bn Shell gas deal

Iraq’s cabinet approved a US$17bn agreement with Royal Dutch Shell and Mitsubishi to capture gas that is currently being flared off in the atmosphere at its southern oilfields, said a government sources.

The 25-year deal is expected to help the country to benefit of more than 700mft3pd of gas that is being burned off at three key fields near Basra and enable the country to start LNG exports. Proposals have been mooted to invest US$4.4bn in a 600mft3pd LNG export facility to be built.

“The cabinet approved the deal through establishment of a company called Basra Gas Company, a joint venture of the South Gas Company and the consortium of Shell and Mitsubishi, to capture the flared gas from the fields of Rumaila, Zubair and West Qurna,” spokesman Ali al-Dabbagh said.