Iraqi lawmakers throw off Shell deal?

BAGHDAD, April 20 (UPI) -- Iraqi lawmakers have called a preliminary oil deal with Royal Dutch Shell unconstitutional in what analysts say is a possible forecast of national trends.

Shell chief Jeroen van der Veer suggested Thursday in Beijing that his company is interested in joining forces with China on a number of oil projects in Iraq.

"We are in the process of forming partnerships for certain bids, and Chinese companies are a part of that," he said.

Jabir Khalifa Jabir, secretary of the Iraqi Parliament's Oil and Gas Committee, said lawmakers had examined preliminary deals for Shell and the China National Petroleum Corp. and found them to be illegal because of a lack of parliamentary consent, The Guardian newspaper reports.

Deals with Western energy majors were met with skepticism by some members of the international community, who saw the U.S.-led invasion in 2003 as an attempt to control Iraqi oil reserves.

Global market intelligence analysts at IHS Global Insight said the decision is foreboding to energy majors queuing up for access to Iraq's lucrative energy resources.

"The Shell deal looks increasingly like a litmus test for progress on all Iraq's oil and gas projects, with any potential failure likely to remove most of the political legitimacy from the Oil Ministry's interpretation of Iraq's Constitution and oil law," the analysts said, according to The Guardian.