Shell is considering withdrawing from Iraq

Shell is considering withdrawing from Iraq

The British-Dutch company is considering selling its oil assets in the framework of its global program to exit after limited gains in Iraq.

Middle East Online

First Published: 2016-11-28



More than a hundred years of work in Iraq

London - industry sources Monday said Royal Dutch Shell is considering selling its oil fields in Iraq in the framework of its global program to exit from assets worth $ 30 billion.

Shell is seeking to reduce its portfolio of oil and gas after the acquisition of BG Group for $ 54 billion in February in a deal that has turned into the largest trade of liquefied natural gas in the world.

With the fall in oil prices since 2014 to less than half want Shell to focus on the areas of highest return activities such as liquefied natural gas and oil production in the deep water Gulf of Mexico and Brazil.

A Shell spokesman declined in London declined to comment.

The British-Dutch company working in Iraq for more than a hundred years did not reaped in recent years has only limited financial benefits from its participation in Iraq, where they receive their dues in the form of crude oil production, but has no audible with respect to the strategy of production, according to sources of sound.

However, sources said that Shell still sees value in the development of its gas sector in Iraq does not want to sell those assets.

Iraq accounted for about 4.4 percent of the total production of Shell's oil and gas in 2015, according to the company's annual report for last year.

The move highlights the sale of oil assets difficulties faced by Iraq in its efforts to increase crude production where you see the foreign oil companies such as Shell that the terms of service contracts is attractive.

Shell operates crazy giant field, near Basra in southern Iraq, which began production in 2014.

Iraq has signed contracts with a large number of major oil companies in nearly six years with his release from sanctions and internal conflicts that lasted for years.

Baghdad wants Saudi Arabia initially compete increase production to more than ten million barrels per day of crude, but administrative hurdles, corruption and poor infrastructure are all underlying factors that caused the delay, including projects led to lower oil production forecast by half.

Nevertheless, Iraq's production has risen a lot lately to about 4.7 million barrels per day, where some of the projects come to fruition began. Iraq urges foreign companies, including BP, Lukoil and Exxon Mobil, Shell and China National Petroleum Corporation (CNPC) to increase investment, which can provide further gains in production.

And acquire Shell's share of 45 percent in oil Majnoon field, which is managed under a technical service contract expires in 2030, according to its annual report for 2015. It holds Malaysian national oil company Petronas stake of 30 percent in the field, while the Iraqi government holds the remaining stake of 25 percent .

Production of the Majnoon field and reached 206 thousand barrels per day on average in 2015.

Shell also has a stake of 20 percent in the West Qurna 1 field operated by Exxon.


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