Shell, Iraq, Near $11bn Petrochemical Deal

By John Lee.

The Wall Street Journal reports that Shell and the Iraqi government are nearing a deal to build an $11-billion petrochemical facility in southern Iraq.

In addition to its development of the Majnoon oil field, Shell also signed a $17.2-billion deal last year to collect natural gas from Iraq's southern oil field production.

The intention to move forward with a petrochemical plant follows a meeting between Iraqi Prime Minister Nouri al-Maliki and Shell Chief Executive Peter Voser in Baghdad on Tuesday. The government said in a statement following that meeting that it was about to sign a "heads of agreement," committing both sides to early planning for the project.

The project -- called Nebras, Arabic for "beacon of light" -- envisions an ethane-cracking unit that would produce ethylene, a compound used in making plastic.

(Sources: WSJ, Office of the Prime Minister)