Jordan inks gas deal with BP

Oct 25, 2009, 12:08 GMT

Aman - The Jordanian government on Sunday signed an agreement with British Petroleum for the development of the Risheh gas field near the Iraqi border, a deal envisaging an eventual investment of about 10 billion dollars.

The accord was signed by Jordanian Minister of Energy and Natural Resources Khaldoun Quteishat, BP's Chief Negotiator Sam Bennett and Fayez Suhaimat, Chairman of the Directors Board of Jordan's National Petroleum Company (NPC) which already has a concession for exploitation of the area.

The development of the Risheh gas field, where daily production currently stands at about 21 million cubic feet of natural gas, will be carried out in two phases, Quteishat told reporters at the signing ceremony which was also attended by Prime Minister Nader Dahabi.

During the first phase which extends over three to four years, BP is under commitment to spend a minimum of 237 million dollars, Quteishat said.

If BP finds gas in commercial quantities, the British company will go to the second phase during which it is expected to spend between eight and 10 billion dollars in the run-up for the production of between 330,000 and 1,000 million cubic feet of natural gas daily.

'These quantities will be sufficient for meeting Jordan's energy needs and even for export,' the Jordanian minister said. Suhaimat said that the government would have a 50-per-cent share in all output stages, with the remainder to be shared by the BP and the NPC.

The Jordanian government hopes the successful development of the Risheh gas field will help bring about a drastic reduction in the country's energy bill which reflects negatively on the performance of the Jordanian economy, economists said.