Shahristani Denies Rumours of Reduced Oil Target

Iraq's Deputy Prime Minister for energy, Hussain al-Shahristani (pictured), said on Sunday that Iraq does not plan to lower its target for oil production of 12 million barrels per day or to re-negotiate contracts with oil firms over their plateau targets.

"Absolutely not. There is no intention at all to renegotiate the contracts," Shahristani told Reuters at the launch of a new power plant outside the city of Kerbala.

Shahristani's comment followed widespread speculation in recent days that Iraq might have to officially slash its target renegotiate oil contracts.

"We are contracted for announced production capacity of around 12 million barrels per day," he said. "But how much we will produce, really, this depends on the international market situation and the market demand."

Shahristani also said the oil ministry had reached a final draft contract on a $12 billion project to capture gas at southern oilfields, and sent the deal to Iraq's cabinet for approval.

Legal hurdles had delayed the deal with Shell and Mitsubishi to capture some of the 700 million cubic feet of natural gas that Iraq flares at its oilfields every day.

(Sources: Reuters, Bloomberg)

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