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Iraq's crazy goings on

Shell's dissatisfaction with its Iraq operations exposes flaws in the country's contract model for IOCs

Iraq has the second-largest proven oil reserves in the Middle East and the fastest growing production. When a major operator, Shell, is considering exiting one of the world's top 10 super-giant fields in that country, something is drastically wrong. The field in question is Majnoon, the Arabic word for crazy. Situated in oil-rich Basra province, southern Iraq, and operated by Shell with a 45% stake, partnered by Petronas (30%) and the Iraqi government (25%), the field has long been one of the most prized in the Middle East and North Africa (MENA) region. Shell won the field in Iraq's second bid round and signed a contract in 2010 to develop the 25bn-barrel reserves for a fee of $1.39 per ba

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