ERBIL, Kurdistan Region of Iraq - Iraq’s Prime Minister on Sunday tasked the country’s ministry of industry to reach a common settlement with Shell following the company’s withdrawal from the country’s largest petrochemicals project.
“The Prime Minister directed that the Ministry of Industry and Minerals reach a consensual settlement with Shell, which informed the government of changing its business strategy and moving to focus more on gas projects in Iraq,” read a statement from the Iraqi prime minister’s office.
The PM’s meeting with the ministries was set around the developments in the Nebras petrochemical project.
“The meeting discussed appointing a consulting body for the project to undertake the technical aspects, specifications, and monitor the technological quality of design and production units,” the statement added.
Shell last week announced its withdrawal from the Nebras petrochemical project.
The Nebras project in Basra was first initiated in 2015, the project’s cost was expected to be around $8.5 billion and would in turn make Iraq the largest producer of petrochemicals in the Middle East with a projected production of 1.8 million tonnes of petrochemicals annually.
The Iraqi ministry of industry on Wednesday said that a possible substitute for the company would be chosen in the coming days.
“There are several candidates who will be subjected to study by the Ministry. A suitable company will be chosen in the coming days, but so far there is no specific name,” Ministry Spokesperson Dhuha al-Juboori told The New Region.
The country had previously called on Saudi giant Aramco to participate in the project.
Iraq, despite having the world’s third largest proven oil reserves, has for years struggled to establish a natural gas industry of its own.
The country is considered among the top countries contributing to global gas flaring, a method that not only wastes the country’s ability to produce its own gas and fuel its own electricity, but also negatively impacts the climate.
For years, Baghdad has been reliant on importing gas from neighboring Iran to fuel the country’s electricity generation, and during excessively hot summers, the country experiences blackouts as Iran at times reduces gas exports claiming they need it for local use.
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