(Dow Jones), Mar. 31, 2010
Royal Dutch Shell will hold the first joint management committee meeting with its Iraqi state partner in April to discuss a preliminary development plan and initial budget for the supergiant Majnoon oil field in southern Iraq, a senior Iraqi oil official said Wednesday.
"They are holding their meetings April 11 and 12," Abdul Mahdy al-Ameedi, head of the Iraqi oil ministry's petroleum contract and licensing directorate, told Dow Jones Newswires.
Majnoon, with estimated oil reserves of 12.6 billion barrels, is largely untapped field producing currently 45,000 barrels a day but is planned to reach 175,000 barrels a day by 2012.
Shell and its partner Malaysia's Petronas won the Majnoon deal in Iraq's second postwar bidding round held in December by pledging to boost production to 1.8 million barrels a day.
The joint management committee will discuss a preliminary plan to develop the field and an initial one-year budget for the project, Ameedi said without giving further details.
According to the 20-year service contract, the Anglo-Dutch supermajor, Petronas and the Iraqi state partner will be paid $1.39 a barrel for their services once they hit commercial production level of 175,000 barrels a day.
Shell holds the majority of the venture at 45% while Petronas owns 30% and the remaining 25% are owned by the Iraq's state-run Missan Oil Co.
Majnoon is among 10 projects that Baghdad had clinched with international oil companies late last year and early this year to try to quadruple Iraq's current production of around 2.4 million barrels a day.
Copyright (c) 2010 Dow Jones & Company, Inc.
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