UK/Dutch Shell Group is close to signing a heads of agreement with the Iraqi government for the construction of a world-scale ethane cracker in the south of the country.

Shell plans to build the Iraqi petrochemicals complex as a joint venture, currently called Nebras, according to Hans Nikamp, Shell’s vice-president and country chairman for Iraq.

The company, which is also developing the nearby Majnoon oil field and leads the Basra Gas Company consortium, signed a memorandum of understanding (MoU) with the Industry & Minerals Ministry in May 2012 for a feasibility study focusing on a petrochemicals plant in the southern Basra province. 

The next step is to sign a heads of agreement with the government, followed by pre-front-end engineering and design (pre-feed) and feed studies.

“By 2020, the joint venture we envisage will need only 5 per cent of the 4 billion cubic feet a day (cf/d) of gas available, according to the Oil Ministry,” says Nikamp, speaking at MEED’s Iraq Energy Projects conference in Dubai.