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satongcollectoron Mar 10, 2011 8:05pm
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1.8 billion dollar shale oil deal today
1.8 billion dollar shale oil deal today Jordan Inks $1.8B Shale Oil Deal with British Firm
Asia Pulse Pte. Ltd.
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Thursday, March 10, 2011
Jordan's Natural Resources Authority (NRA) has signed a landmark US $1.8 billion shale oil deal with Karak International Oil (KIO), wholly owned by British firm Jordan Energy and Mining Ltd (JEML).
The oil shale surface retort concession agreement in Al-Lajjun area (an area of 35 sq km) in the southern governorate of Karak was signed on Wednesday between the NRA and KIO representatives.
Over a period of 5-7 years the production is planned to reach 15,000 bpd, after which it may be increased to 60,000 bpd in phased expansions. Additional by-products will include sulfur and electrical power some of which (30MW) will be fed into the national grid.
The agreement also includes comprehensive environmental terms including compliance with prescribed environmental standards and monitoring of performance through an emission control system. Moreover, it covers aspects relating to the optimal use of water.
The deal defines a major non-conventional oil venture to be completed in the Al- Lajjun area with a capital investment of US $1.8 billion and will put Jordan on track for self-sufficiency in liquid hydrocarbons. The project will be based on surface mining of oil shale followed by the application of modern Canadian technology provided by the Thyssenkrupp Group of Germany utilizing thermal cracking and retorting methods.
Polysuis AG will be the sponsor of the project, a subsidiary of tHyssenKrupp Group. Which will prepare the designs, install the equipment and maintain it, as well as keeping the flow of its work.
On completion of the project and with oil prices remaining high the government will receive more than 65 percent of net operating profits and if oil prices reached the very high levels of 2008 (>$120/bbl) the government will receive some $10 billion of revenues over the projected 30 year project life.
It should also be noted that this project will recruit some 700 people in direct jobs, and an estimated 2,500 indirect jobs in construction and support services.
According to the Natural Resources Authority data, the Kingdom has more than 40 billion tons of oil shale; this quantity is capable, if were exploited using cutting-edge technology, to meet the oil needs of the Kingdom estimated at 110,000 bpd and even may allow export of additional quantities over a span of hundreds of years.
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