Iraq Oil Minister: 'Iraq Now Pumping 2.5MM B/D of Oil'
VIENNA (Dow Jones Newswires), September 9, 2008
The oil price is fair at current levels above $100 a barrel, Iraqi oil minister Hussein al-Shahristani said Tuesday.
The Iraqi oil minister also mentioned that Iraq is now producing 2.5 million barrels a day and aims to increase that level to pump 2.7 million barrels a day by the end of this year, Shahristani said.
OPEC, gathering for its third meeting of the year on Tuesday, is widely expected to hold output steady as it surveys oil prices that have fallen sharply over the past few months.
Shahristani said the government has approved an agreement with Shell to jointly develop domestic gas infrastructure in the country's south. He said he expects the deal will be signed within a couple of days.
The Iraqi government will hold a 51% stake in the venture with Shell, the oil minister said.
A Royal Dutch Shell spokesman earlier Tuesday said Shell expects to sign the agreement with the Iraqi government in the near future.
Iraq's government approved the $3 billion-$4 billion joint venture between Shell and the state-run South Oil Co. over the weekend.
"The role of the joint venture will be to capture and commercialize natural gas in the Basra Governorate in South of Iraq," said the Shell spokesman.
Around 700 million cubic feet of natural gas are burned off each day from oil fields in the Basra region because there is no infrastructure to utilize it. The Iraqi government wants to use the gas for domestic electricity generation.
A statement from the Iraqi government said the agreement also provides for construction of several liquefied natural gas export facilities.
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