The agreement to develop oil shale deposits in three areas of Jordan would probably end up satisfying the country's energy needs.
Jordan signs oil shale agreements
Jordan has signed oil shale exploration agreements with Royal Dutch Shell and Inter Rao of Russia, as it seeks to decrease its dependence on energy imports. Shell's preliminary deal is worth more than Dh1 billion (US$272 million), according to media reports quoting Jordanian government and company officials on the sidelines of the World Economic Forum. The agreement to develop oil shale deposits in three areas of Jordan would probably end up satisfying the country's energy needs, Maher Hijazin, the director of the kingdom's Natural Resources Authority, told Bloomberg. Mr Hijazin valued the deal at $340m.
"We are expecting Shell to spend $500m for exploration, assessment and designs on the project," the Jordanian energy minister, Khaldoun Qutishat, told Zawya Dow Jones. The final investment decision for the initial phases of the project, expected to take 12 to 18 years, could be worth $15bn, Mr Qutishat said. Jordan's Cabinet has ratified the draft agreement, but parliamentary approval, expected later this year, is also needed to validate the deal.
"I am very optimistic about the resources," Malcolm Brinded, a Shell vice president, told Zawya Dow Jones. "It is a very significant area and we look forward to start the exploration process after the parliament's approval." Mr Hijazin said Jordan had also signed a two-year memorandum of understanding with Inter Rao to explore oil shale deposits in the central part of the kingdom. The country has previously signed four similar preliminary deals with Indian, Saudi and Jordanian firms and the Brazilian state oil company, Petrobras.
Last year Eesti Energia, an Estonian utility, agreed to build a 900-megawatt oil shale-fired power plant in Jordan. Jordan, with a population of about 6 million, imports roughly 100,000 barrels a day of oil to cover 95 per cent of its energy needs. But the country is rich in oil shale. Although commercial oil shale development is expensive and environmentally controversial, the kingdom has long eyed its 40 billion tonnes of reserves as a means of securing energy independence.