Petrofac, the international oil & gas facilities service provider, and China Petroleum Engineering & Construction Corporation (CPECC), the engineering and construction subsidiary of China National Petroleum Company (CNPC), have established a new strategic joint venture, China Petroleum Petrofac Engineering Services (CPPES). Based in Sharjah, UAE, the joint venture will provide project management and engineering services for selected oil & gas projects, focusing on projects for Chinese oil & gas companies.

Petrofac and CPECC have a long-standing relationship and track record of cooperation, most recently being jointly awarded an inspection, maintenance and repair contract for the Rumaila oil field in Southern Iraq. The strengthened relationship was recognised at an official ceremony that took place at CPECC’s offices in Beijing on 19 September.

The joint venture which is 51% owned by CPECC and 49% owned by Petrofac, following formal signing and exchanging of contracts, will be established under the leadership of personnel from both companies.

Maroun Semaan, group chief operating officer, Petrofac, commented:

“Cementing our association with CPECC represents a significant milestone for Petrofac. Our relationship with CPECC extends over the last seven years and I am delighted it has been strengthened with the creation of this joint venture. Together, we have considerable resources and world-class engineering and construction expertise and our collaboration should enable us to capitalise on the significant opportunities in China and internationally.“

Mr Hou Haojie, President, CPECC, commented:

“It is a delight that CPECC and Petrofac have come together to combine and harness their respective talents in order to deepen the portfolio in our local and international markets.“

The governor of Iraq’s Wasit [Wassit] province, Mahdy al-Zubaidy, has announced that production at the al-Ahdab oilfield has reached 60,000 barrels per day (bpd).

According to a report from Bloomberg, he went on to say that the field’s output capacity will increase to 120,000 bpd by the end of the year, while Oil Minister Abdul Kareem al-Luaibi [Elaibi] told reporters to expect 200,000 bpd by the middle of next year.

In November 2008, the state-run China National Petroleum Corp. (CNPC) won a $3.5 billion contract to develop al-Ahdab. Iraqi officials estimate Al-Ahdab contains about 1 billion barrels of oil.

(Source: Bloomberg)

Iraq has asked China to set up a fund to help with the reconstruction of the war-battered country, Iraqi government spokesman Ali al-Dabbagh said on Monday during a visit to Beijing by Iraqi Prime Minister Nuri al-Maliki.

Reuters reports that he also said Baghdad was keen to get Chinese companies investing in the country, which was China’s seventh largest supplier of oil last year.

The United States has spent $54 billion in relief and reconstruction efforts since the 2003 invasion, and it and the Iraqi government have spent billions more in Iraqi money, but ordinary people have seen little improvement.

The Iraqi government, which gets most of its $72 billion budget from oil revenues, says it is committed to improving basic services, but progress is painfully slow.

“We are asking the China side to make a fund, for … reconstruction and to guarantee and assure the investment in Iraq for Chinese companies,” Dabbagh told reporters in Beijing.

“Koreans they did the same; they had to create a fund [with] which they support their companies to work in Iraq. Germany is going to make such a thing. Iraq is requesting from China to have such (a) fund,” he added, speaking in English.

Chinese oil firms from have been working hard to rebuild their presence in Iraq since several big contracts signed by Chinese oil firms were cancelled in 2003 following the toppling of former president Saddam Hussein.

In 2008, the state-owned China National Petroleum Corporation (CNPC) successfully renegotiated a contract originally signed by the previous regime to develop the al Ahdab oilfield, becoming the first country to sign an oil service contract in Iraq under the new U.S.-backed regime.

CNPC completed construction of the first phase of the oilfield in June this year, and it is also developing Iraq’s Halfaya oilfield with France’s Total and Malaysia’s Petronas. CNPC also has a 37 percent stake in a service contract to develop the Rumaila oilfield, which pumps out almost half of Iraq’s total oil output.

Reuters reports that the China National Petroleum Corp (CNPC), the first foreign oil company to sign an oil service contract in Iraq after former president Saddam Hussein was toppled, said on Monday said that it completed construction of the first phase of the Al-Ahdab oilfield.

The parent of PetroChina Co Ltd said it started work on the Al-Ahdab oilfield in March 2009 after successfully renegotiating an old development deal, and hoped to pump 110,000-130,000 barrels per day (bpd) from the field, which had estimated reserves of 1 billion barrels.

Completion of the first phase, with a capacity of 60,000 bpd, was ahead of schedule, marking major progress in building Middle East oil and gas projects, reported the China Petroleum Daily, CNPC’s in-house newspaper.

The field was the first new oil capacity building project in 20 years in Iraq, the report said.

(Source: Reuters)

The China National Petroleum Corporation (CNPC) and its partners in the southern Halfaya oilfield have awarded a $174 million contract to the China Petroleum and Engineering Corp. (CPECC) to build three crude processors, an Iraqi oil official told Reuters on Sunday.

Ali Maarij, head of Iraq’s state-run Missan Oil Company said the new plants will raise the production capacity of Halfaya field by 100,000 barrels per day.

Halfaya field currently produces around 12,000 bpd and plans to hit 20,000 bpd by the end of this year. Production of around 90,000 bpd is expected to be achieved in the first quarter of 2012, Maarij said.

(Source: Guardian)

China National Petroleum Corp (CNPC) has started to get paid for developing Iraq’s Rumaila oilfield, according to reports from the China Petroleum Daily.

The company received its first cargo of oil as payment for helping to develop the oilfield on 28th May, two weeks after partner BP loaded its first shipment.

A crude oil carrier carrying 2 million barrels of oil left Basra Oil Terminal in southern Iraq on Saturday en route to China.

BP holds 38%, CNPC has 37% and Iraq holds 25% stakes, respectively, in the 20-year service contract for Rumaila oilfield.

(Source: China Petroleum Daily)

BP lifted its first cargo of Basra light crude from Rumaila this week, according to a report in the Telegraph. The cargo is worth about $200m [240 billion Iraq dinars].

The company is working with China National Petroleum Corporation (CNPC) on the field and the two companies are due $1bn for boosting production, drilling new wells and improving operations over the past year.

They have managed to increase production at Rumaila by 10pc more than expected. After a year of work, output is now running at about 1.2m barrels per day – 100,000 barrels ahead of the earlier output.

Rumaila once produced 1.6m barrels, but it has been neglected during years of war and sanctions.

(Source: The Telegraph)

The consortium of Chinese, Malaysian and French companies working on the Halfaya oil field, 35 km east of Amara, in Maysan [Missan] province, have completed drilling four oil wells.

Ali Altarfi, the media department of Missan Oil Company, told Aswat al-Iraq that, “the plan is to drill 300 wells in this gigantic oil field within 5 years, according to the agreement signed with the Ministry of Oil.”

The contract stipulates that production should reach 535 thousand barrels per day (bpd), which is five times higher than the local production of the field, in addition to provision of gas products to neighboring power stations.

“The reserves of this oil field are expected to reach 15 billion barrels,” Altarfi added.

The companies that won the bid to develop this field are CNPC, Total, and Petronas.

(Source: Aswat al-Iraq)