Shell to Replace Exxon at West Qurna 1?

According to Dow Jones, the Iraqi oil ministry could ask Shell to develop Iraq's supergiant West Qurna Phase 1 oil field in southern Iraq, if the government decides to terminate ExxonMobil's contract after it signed a deal to explore for oil in Iraqi Kurdistan.

"We have many options," said Abdul Mahdy al-Ameedi, head of the ministry's petroleum contracts and licensing directorate, when asked what the ministry would do if the West Qurna 1 oil field contract with ExxonMobil is cancelled.

"It is possible that Shell, or any other company, can replace ExxonMobil in West Qurna 1 field," he told Dow Jones Newswires in an exclusive interview. "The partner of ExxonMobil in West Qurna 1 is Shell, and Shell is a giant ... company and it is well aware of and taking part in all operations and activities in the field."

Shell reportedly pulled out of talks with the Kurdistan Regional Government last week following Baghdad's reaction to the Exxon deal.

Exxon Mobil Iraq Limited is the lead contractor at West Qurna Phase 1, with a 60% stake, while Shell has 15% and the remaining 25% belongs to the Iraqi state company.

Iraq's Oil Minister Adbul-Kareem Luaibi [Elaibi] said on Monday that both he and Prime Minister Nouri al-Maliki have written to Exxon Mobil and are awaiting a reply. He did not state the content of the letters, according to Reuters.

"Taking a decision to terminate West Qurna 1 contract is easy and the (oil) minister can take such a decision tomorrow, but we don't want to rush," Ameedi said. "We want first to make our position very clear and based on legal and sound basis despite the terms of the contract consolidating our position."

(Source: Dow Jones, Reuters)

One Response to Shell to Replace Exxon at West Qurna 1?

  1. Re da Caste 23rd November 2011 at 00:41 #

    Are you completely out of your mind? Do you really believe Maliki and his friend (?) Sharhistani dare to confront US's biggest oil company on this issue? I bet Maliki will not and Sharhistani will beforced to resign soon. He is costing Iraq and their people a lot of money!