Iraq, Shell to sign $12bn gas deal

Iraq will sign a final contract with Royal Dutch Shell on Tuesday for a USD 12-billion project to capture flared gas at southern oil-fields.

The final version of the contract, which has been held up by legal problems and political disagreement, will be sent to the cabinet for approval after it is initialled this week.

The 25-year development deal would help Iraq capture more than 700 million cubic feet per day of gas currently being burnt off at three southern oil-fields -- Rumaila, Zubair and West Qurna Phase One, auctioned in the first bidding round in 2009.

The Shell joint venture also includes setting up a liquefied natural gas project at a later stage to export any excess gas with a maximum capacity of 600 million cubic feet of gas per day.