World Bulletin/News Desk
Royal Dutch Shell is exploring possibilities in Iraqi Kurdistan, sources said, having seen rivals Exxon Mobil and Total risk Baghdad's wrath by moving into the autonomous northern region while developing major oilfields in the south.
Shell has come close to securing contracts with the region twice before but pulled back so as not to antagonise the central government in Baghdad, which regards all deals signed by the Kurdistan Regional Government (KRG) as illegal.
Any decision by Shell to follow Exxon, Gazprom and Total into the fast-growing oil province would be bound to irritate Baghdad. Even so, while the moves have displeased the central government, it has yet to kick them out of their projects.
"Shell is in conversation with the KRG," a source with knowledge of the matter, who asked not to be identified, said on Friday. "It could eventually lead to something material in Kurdistan."
The Anglo-Dutch major is already at work in Iraq's supergiant southern oilfields of Majnoon, where it is the operator, and West Qurna-1, where it's Exxon's junior partner. The company is also in a $17 billion gas joint venture with Iraq.
A Shell spokesman declined comment on talks about Kurdistan.
"Over time, we want to work in all of Iraq, but for the time being we've got three mega-projects on the go ... we're already one of the biggest oil and gas investors in country, so that's a big vote of confidence for where Iraq's going," spokesman Jonathan French said.
"We will, however, always be looking for new opportunities and projects where we can add value to Iraq."
Shell has always wanted a presence throughout Iraq and has long had its eye on Kurdistan, first considering involvement in 2007. A second attempt was made just a year ago with Exxon.
Kurdistan's proven reserves of 45 billion barrels amount to more than a third of the national total of 143 billion recorded in BP's annual statistical review, where Iraq accounts for 8.7 percent of the world's known oil.
But Shell did not want to find itself caught, as Exxon is now, in the middle of political infighting between Baghdad and Arbil, the seat of Kurdistan's government, said a source close to the company.
Oil and land rights have been at the centre of a long-running dispute between Kurdistan and Iraq's central government. Last week, the KRG reached a deal with Baghdad to end a dispute over oil payments.
But that agreement will resolve only part of the broader tension between the centre and the region.
Last October, Shell had planned to move into Kurdistan with Exxon but withdrew at the 11th hour to ensure its gas joint venture got the final go-ahead from Baghdad, industry sources say.
Senior executives at Shell were divided over whether that was the right decision, said a source familiar with the company.
Since Exxon's move, Chevron, Total and Gazprom have taken up acreage, leaving little left to secure. Statoil and ConocoPhillips are also circling, according to industry sources.
In the year since Exxon made its bold northern play, Shell - like other companies involved in southern Iraq - has waited to see how Baghdad would retaliate. So far, the U.S. major has gone largely unpunished.
Part of Exxon's motivation for taking on Kurdish exploration blocks may have been the better terms on offer there. Margins on Iraq's southern projects are slim by comparison, say industry sources. They said that may also be driving Shell's discussions, however preliminary these may be.
Sources in Arbil say Shell has tried the patience of Kurdish Prime Minister Nechirvan Barzani and Energy Minister Ashti Hawrami by twice walking away.
While Baghdad has barred companies involved in Kurdistan from doing any further business with the central government, the KRG energy minister said, however, that the region does not have a "blacklist".
"Our criteria are capability and seriousness of intention to invest," Hawrami told Reuters on Tuesday.
Radical cleansing will start a new era in Turkey, says the head of the Turkish Cooperation and Development Agency (TIKA)
EU Commissioner for Jobs, Growth and Investment and Competitiveness Jryki Katainen told reporters "we should forget this phrase" when asked if that meant granting market economy status to China.
Militancy has reduced revenue from oil industry by half, senior official says
The grant was signed Monday in Nairobi to mitigate impact of forced displacements on refugee hosting communities in East Africa
The EU Trade Commissioner Malmstrom made the comment while speaking to Chinese students in Beijing ahead of a China-EU summit.
Trade Ministers Meeting in Shanghai concludes with pledge to push efforts toward trade liberalization and facilitation
Brexit raises uncertainty for consumer, investor confidence, ratings agency says
Bank of England Governor Mark Carney eases lending rules after vote for Brexit
Banca Monte dei Paschi di Siena, or BMPS, is among the banks at the forefront of those concerns with gross bad loans amounting to 46.9 billion euros ($52 billion).
Fund to be used in support of education, health, municipal, socio-economic support for refugees in Turkey
Turkish Statistical Institute says energy prices drive fall in imports
Given all the uncertainty, investors were pricing in a chance of a rate cut with some analysts expecting the Bank of England to consider quantitative easing to cushion the economy
The Egyptian stock index was down 5.8 percent in early afternoon.
The pound sterling sees its lowest level against the the US dollar in over 30 years