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Shell to sell 20% stake in West Qurna oil field

LONDON

Royal Dutch Shell is in the process of selling its 20 percent stake in Iraq’s West Qurna 1 oil field, a spokesman said on Wednesday.

The move comes as the Anglo-Dutch company said it had handed back to the Iraqi government operations at the Majnoon oil venture, one of the largest fields in Opec member Iraq.

A spokesman for the company confirmed that Shell’s stake in the West Qurna field, operated by Exxon Mobil , was subject to an ongoing sales process.

“In May 2017, the ministry of oil in Iraq applied the performance penalty and remuneration factor on the Shell operated venture, the Majnoon oil field, which had a significant impact on its commerciality,” a Shell spokesman said.

Shell then decided that it was in the best interest of all parties to hand over operations of the Majnoon venture to the Iraqi government.

“Shell remains firmly committed to Iraq. By handing over Majnoon operation to the ministry of Oil, Shell will be in a stronger position to maximize value to the government of Iraq and its people as well as our shareholders by focusing its efforts on the development and growth of Basra Gas Company,” the spokesman said.

Basra Gas Company is a joint venture between Shell, South Gas Company and Mitsubishi and the Petrochemical Project NEBRAS.

In November, industry sources had said that Shell was considering selling out of its oil fields in Iraq as part of its global $30 billion asset disposal programme.

Shell is the operator of the giant Majnoon field near Basrah in southern Iraq which started production in 2014.

The officials said the oil ministry and Royal Dutch Shell had been discussing investment budgets and production activities but failed to reach a deal.

Agencies