$11bn Iraq petrochemical project stalls

07 September 2017

Iraqi official blames failure to progress due to lack of coordination between ministries

The $11bn Nibras petrochemical project in Basra is stalling because of a “lack of coordination between the Ministry of Industry and the Ministry of Oil,” according to Ali Shadad Al-Fares, head of Basra Council’s Energy Committee.

Speaking at a conference in London, he said it was one of a number of key projects that had been delayed by problems at ministerial level.

“The relationship between the oil and gas sector, petrochemicals and electricity with other sectors has unfortunately been inconsistent,” he said.

“Sometimes we see the ministry as a hindrance to the implementation of some of the strategic projects that could be saving us from the financial and economic crisis.”

Under current plans the Nibras petrochemicals complex will produce around 1.8 million tonnes of petrochemical products per year.

The client is Iraq’s Ministry of Industry and Minerals and close coordination with the Ministry of Oil in order to secure feedstock for the facility.

In January 2015, Anglo-Dutch Shell signed a contract to act as a consultant on the $11bn project.

The project was expected to come online within five to six years and make Iraq the largest petrochemical producer in the Middle East. However, it has failed to progress beyond feasibility studies. On July 2017, after a series of delays, Iraq’s Parliamentary Oil Committee announced that the project had been put on hold because of problems allocating land for the project and a failure to agree on the price and quantity of gas to be supplied to the facility.

 Zaher Abadi, a member of the committee, said, “Royal Dutch Shell has stopped work on the establishment of Nibras Petrochemicals project in the province of Basra.”

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