Basrah Gas Proposals Risk Undermining TotalEnergies Megadeal

1 Apr 2022 Issue: 65 / 13 By: Yesar Al-Maleki

The Shell-led Basrah Gas Company has submitted two proposals to process gas from Iraq’s Majnoon and West Qurna-2 fields. If accepted, this would undermine a key pillar of TotalEnergies’ high profile $27bn megadeal, raising questions over the viability of the whole undertaking.

Baghdad has for years stated that tackling widespread gas flaring is a key energy sector priority, but progress has been achingly slow. Gross federal raw gas output was around 2.7bn cfd for 2021, yet after flaring a touch over 50% of this, Iraq was left with just 1.3bn cfd of sales gas.

The bulk of this was provided by Basrah Gas Company (BGC: state-owned South Gas Company 51%, Shell 44%, Mitsubishi 5%), which has 1bn cfd gas processing capacity in the oil and gas heartlands of Basra province. BGC is expanding its facilities to 1.4bn cfd, but its original peak target of 2bn cfd from the Rumaila, West Qurna-1 and Zubair fields which were awarded in Iraq’s first licensing round (LR1) in 2009 is now unattainable after their production plateau targets (PPT) were revised down in 2014 (MEES, 5 September 2014). (CONTINUED - 2905 WORDS)