ExxonMobil denies pulling out of Saudi Arabian gas projects

A multi billion-dollars natural gas initiative is still on track, Saudi Arabia said, denying reports that ExxonMobil, the world's leading oil company, had pulled out of the project.
"I have received a letter from ExxonMobil Chairman Lee Raymond categorically denying the company had pulled out," as reported, Saudi Foreign Minister Prince Saud al-Faisal told. "He assured that they are still enthusiastic about the project," added Prince Saud, who heads a ministerial committee conducting talks with eight foreign firms.
Raymond was quoted as saying the Saudi project was not competitive and the company had abandoned it. But a spokesperson for ExxonMobil told: "Raymond's statement was taken out of context. We continue to have discussions with the Saudi government on the natural gas initiative."

Prince Saud said the US-led war on Iraq had no impact on the talks between Riyadh and eight international firms over three gas projects requiring investment to the tune of $ 25 bn.
"We are still evaluating answers received by the companies over an offer made by the government months ago. We want to reach an agreement that preserves the kingdom's interests fully and provides sufficient profits for the companies," he said. "I don't think it will be too long before the kingdom makes its response... we hope to do this soon," Prince Saud said.
But he stressed that if talks collapsed, the government would provide the funds to build power, water and petrochemical plants associated with the gas projects. ExxonMobil has secured the lead role in project one and two while Shell got the lead in the third project.

Prince Saud said in January talks on the second project have been suspended while Saudi Arabia reviews its economic situation. But Prince Saud said Riyadh had received "positive" responses from the core venture 1 (CV1) and core venture 3 (CV3) consortia and expected final talks to start soon. CV1 foresees development of the South Ghawar field requiring investment of up to $ 15 bn.
The government signed preliminary agreements in June 2001 with eight international oil companies for the development of the mega gas projects, but the final deal has proved elusive as deadlines have come and gone. Shell has a 40 % interest in CV3, with the remaining 60 % split evenly between TotalFinaElf and Conoco.