Iraq and Chevron Phillips signed a Letter of Intent
Iraq and Chevron Phillips Chemical Corp, a joint venture of Chevron Corp and ConocoPhillips, signed a letter of intent to perform a project feasibility study of developing a petrochemical plant in the country.
The company would examine building a new facility and upgrading an existing Iraq-owned petrochemicals factory in southern Basra province, Hanaa al-Husseini, a spokeswoman for the Industry and Minerals Ministry, said in Baghdad.
The Woodlands-based, Texas, Chevron Philips wants to assess the feasibility of developing an integrated petrochemical complex.
Chevron Phillips is considering to invest $6 billion capital expenditure.
Chevron Phillips has obtained a licence to operate in the city, and the Basra Investment Commission has also voiced its support for the project and is now seeking to allocate a plot of land.
Once launched, the project is expected to provide up to one thousand jobs for local people
The purpose of this feasibility study is to provide Chevron Phillips and the Iraq Government some first cost estimates or potential time frame for the project.
Chevron Phillips, Shell and Mitsubishi prepare $30 billion projects
Iraq’s oil output is on the rebound after the war, but the natural-gas produced in association with crude oil is still flared because it lacks the infrastructure to use it as a fuel for electricity plants or feedstock for petrochemicals.
In that purpose the Iraqi Government signed in November a $17 billion contract with Shell and Mitsubishi to capture flared gas from its oil fields in the south of the Iraq.
In parallel to Chevron Phillips, Shell has signed a Memorandum of Understanding with the Iraqi Government about the construction of a petrochemical complex projected around $8 – 10 billion capital expenditure.
With Shell, Mitsubishi and Chevron Phillips, the Iraq Government is paving the way to $30 billion capital expenditure in projects for the petrochemical industry in the Basra region.