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Saudis again reject offer by major Western energy firms

SPECIAL TO WORLD TRIBUNE.COM
Wednesday, September 11, 2002

LONDON Ñ Saudi Arabia has again rejected an offer by Western energy majors for the development of the kingdom's natural gas sector.

Industry sources said a Saudi ministerial panel led by Foreign Minister Prince Saud Al Faisal turned down a counterproposal by Western energy majors in a letter sent last week, Middle East Newsline reported. They said the Saudi letter essentially reiterates the terms previously submitted by the kingdom for the estimated $30 billion gas and infrastructure project.

The Saudi proposal is said to offer a rate of return of up to 12 percent. The oil majors have asked for an 18 percent rate of return.

The major companies vying for the Saudi project are ExxonMobil, Royal Dutch/Shell and BP. The companies are being asked to formally reply to Riyad's terms regarding the gas project in October.

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