JEDDAH, 12 November 2003 — The government has directed Petroleum and Mineral Resources Minister Ali Al-Naimi to sign a $2 billion gas project with a consortium led by Royal Dutch Shell. The Council of Ministers, chaired by Custodian of the Two Holy Mosques King Fahd, on Monday authorized the minister to sign the deal, the Saudi Press Agency reported.
The Supreme Petroleum Council and the Shoura Council have approved the deal which involves the creation of a new company for gas exploration and production in an area of 209,000 sq km in the Rub Al-Khali, the Empty Quarter, in the south of the Kingdom.
Shell will have a 40-percent stake, with TotalFinaElf and Saudi Aramco controlling 30 percent each.
The Shell-Total deal comes after the collapse in the summer of the Saudi Natural Gas Initiative (NGI) in its integrated form, which included power, water and petrochemical projects in addition to gas exploration and production. Two other mega gas projects, requiring $20 billion in investment, also collapsed.
