Iraq Sweetens New Oil Project Terms, Blames Shell for Delay
The spat indicates the infrastructure challenges facing foreign oil companies working in Iraq. Industry sources say Shell is particularly wary of health and safety failings, so work may take longer.
Shell, asked to comment on the letter, said it found when it started opening existing facilities towards the end of 2012 that extra work was needed. The company said it was still targeting output of 175,000 bpd at Majnoon before the end of the year.
"The safety of our people and assets remains our top priority in Iraq, so we have been working on getting the facilities back to an acceptable condition and ensure a safe and reliable operation," a Shell spokesman said.
"Drilling operations to restart new production in Majnoon have successfully concluded and we expect to open the wells in the near future."
Other oil executives downplayed the spat, seeing it as a largely routine part of sometimes rocky relations between the industry and its host governments.
"It's noise – no big deal," said one, from a rival company. "It's just the Ministry of Oil diverting attention that the delay is largely SCOP's (Iraq's State Company for Oil Projects) fault."
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