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.
Pakistan will give India Most Favored Nation status by the end of March.
"Germany's dependence on Russian gas may effectively decrease Europe's sovereignty. I have no doubts about that," Polish PM Tusk said
EU member Bulgaria has started preliminary works on the pipeline on its territory, but has repeatedly said its operation should be in line with EU rules
Japan posted a current account deficit of 1.58 trillion yen (US$15 billion) for January.
The Asia-Pacific would be left with more than half a billion chronically hungry people even if the region meets its millennium development goal
The Visegrad 4 group including Poland, the Czech Republic, Hungary and Slovakia is looking to diversify supplies
Nick Letchford, managing director of the group that owns the Old Shoreditch Station cafe, decided to install the machine after noticing the popularity of bitcoins among his customers working nearby in the digital industries.
Varying degrees of drought are hitting almost two thirds of the limited arable land across Syria, Lebanon, Jordan, the Palestinian territories and Iraq.
Turkey deems Iranian gas too expensive compared with other suppliers like Russia and Azerbaijan, an assertion rejected by Tehran.
Satoshi Nakamoto, a name known to legions of bitcoin traders, practitioners and boosters around the world, appeared to lose his anonymity on Thursday after Newsweek published a story that said he lived in Temple City, California, just east of Los Angeles.
BP's exploration and production sharing agreement with Libya covers onshore acreage in Ghadames, near the border between Libya, Algeria and Tunisia, and offshore acreage in the central Sirte basin
There are discussions at high levels within the U.S. government on how to use U.S. natural gas resources
The judicial sources said on Thursday that prosecutors suspected the companies of working together on campaigns to favour Lucentis, including promoting it to local doctors
Scotland's Energy Minister Fergus Ewing offered to meet Shell to discuss the future of the oil and gas industry if Scotland votes to end its 307-year tie with England
European Commission President said that from a purely financial standpoint the crisis in Ukraine should not have much impact on the euro zone but there was potential for far greater instability