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The latest news on Iraq Oil Production – oil companies, oil output and more – brought to you by Iraq Business News

New Tank Farm to Stabilize Oil Exports


By John Lee.

Oil Minister Dr. Adel Abdul Mahdi [Adel Abdel Mehdi] has announced a plan to build new oil storage tanks to help smooth oil production during bad weather.

Iraq’s exports were restricted in January due to bad weather in the Gulf.

(Source: AIN)

(Oil tanks image via Shutterstock)

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GKP Suspends Truck Shipments; Shares Slide


By John Lee.

Shares in Gulf Keystone Petroleum (GKP) were down 10 percent on Friday morning, after it announced the suspension of crude oil exports by truck from Iraqi Kurdistan.

The company said it remains in a dialogue with the Kurdistan Regional Government’s Ministry of Natural Resources (“MNR”), in order to receive the outstanding payments due to it and establish a stable payment cycle for export crude oil sales in the future.

In a statement to the markets, the company added:

In the interim, in order to maintain revenues and cash flow, Gulf Keystone will be recommencing crude oil supply for local Kurdistan use. This provides the prospect of receiving revenues in the near term.

“Export crude oil deliveries by truck have therefore been temporarily suspended. This is expected to be a short term measure until a regular payment cycle can be established for sales via the export route. The Company is actively working towards an early pipeline access solution for Shaikan crude, which will provide significantly improved margins than trucking to the export market.

“As previously announced, the Company will publish its results for the year ended 31 December 2014 on Thursday 9 April 2015.

John Gerstenlauer (pictured), Gulf Keystone’s CEO said:

Further to the oil export agreement between the Kurdistan Regional Government and Federal Government of Iraq reached in December 2014, and the recent passing of Iraq’s 2015 federal budget, we remain confident that a stable payment cycle will be established in the near term, and we expect to receive payment for all past and ongoing oil sales from Shaikan.

“The Company is taking a prudent approach to its capital expenditure in 2015 and is striving to ensure consistent and stable revenues in the short-term, which a return to the domestic market provides. Meanwhile, a number of longer term financing options are currently being progressed by the Board.

(Sources: GKP, Yahoo!)

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Khabbaz Oilfield Output Suspended


By John Lee.

Production at the Khabbaz oilfield, 20 km southwest of Kirkuk, remained suspended on Monday following severe damage during a weekend attack by Islamic State (IS, ISIS, ISIL) insurgents.

Oil Minister Dr. Adel Abdul Mahdi [Adel Abdel Mehdi] (pictured) said there is severe damage to the field, which was recaptured by Kurdish forces on Saturday.

The Minister declined to speculate on when operations would resume.

Khabbaz has a maximum capacity of 15,000 bpd, and was producing around 10,000 bpd before the attack.

(Source: Reuters)

Posted in Oil & Gas, SecurityComments (0)

Genel Energy Down 3% on Trading Update


Shares in Genel Energy were down 3 percent on Wednesday morning following the company’s trading and operations update in advance of the its full-year 2014 results, which are scheduled for release on 5 March 2015. The information contained herein has not been audited and may be subject to further review:

HIGHLIGHTS

  • A combination of low development and operating costs and Production Sharing Contract structure creates a robust Kurdistan Region of Iraq (“KRI”) oil business very resilient to sustained low oil prices
  • 2014 production of 69,000 boepd, an increase of 58% year-on-year with significant further growth expected in 2015
  • Capital expenditure guidance for 2015 lowered by 30% to $200-250 million, a reduction of 70% on 2014
  • Revenue guidance for 2015 revised from $500-600 million at a Brent price of $80/bbl to $350-400 million at a Brent price of $50/bbl
  • Cash balances at 31 December 2014 stood at c.$490 million, balance sheet strength underpins future growth in the KRI
  • Agreement on crude oil exports through northern Iraq reached in December 2014 between the Kurdistan Regional Government (“KRG”) and Federal Government of Iraq (“FGI”), operational implementation commenced in early January 2015
  • First payment for oil exports via the pipeline received in December, further payments expected shortly

PRODUCTION

  • Net working interest production for 2014 averaged 69,000 boepd, an increase of 58% on 2013 and at the top end of the 60-70,000 boepd guidance range
  • Gross production from Taq Taq averaged 103,000 bopd in 2014, an increase of 34% on 2013. Following the successful installation and commissioning of well site temporary production facilities in December 2014, Taq Taq set a new daily production record of 135,000 bopd and a new record for gross daily liftings of 147,000 bopd
  • Gross production from Tawke averaged 91,000 bopd in 2014, an increase of 131% on 2013
  • In 2014, 36% of Genel’s production was exported by the KRG through the KRI-Turkey pipeline system, with 12% exported by the KRG via Turkey by truck and the remainder sold into the domestic market
  • The Company’s 2015 production guidance is maintained at 90-100,000 boepd

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Record Oil Production set to Increase


By John Lee.

Iraq produced a record of around 4 million barrels per day (bpd) of crude oil in December, Oil Minister Adel Abdel Mehdi (pictured) told a press conference on Sunday.

This beat the previous record for Iraqi production of 3.56 million bpd in 1979, according to an official from the State Oil Marketing Organization (SOMO).

The Minister went on to reveal plans to export 375,000 bpd for the first three months of 2015 from Kirkuk and the Kurdistan region, increasing to 600,000 bpd from April.

(Source: Reuters)

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Southern Oil Output at 3m bpd


By John Lee.

The current average output from Iraq’s southern oilfields is reported to be about 3 million bpd, according to a report from Reuters.

Oil Minister Dr. Adel Abdul Mahdi [Adel Abdel Mehdi] told reporters that average export levels are about 2.5 million bpd.

(Source: Reuters)

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Lukoil to Increase Output at West Qurna-2


By Patrick M Schmidt.

The Dubai-based division of the Russian oil company, Lukoil announced revise production figures for the West Qurna-2 fields.

The company began production in March 2014 with an output of approximately 120,000 barrels of oil per day. Current production levels are now at 300,000 barrels of oil per day.

It is expected output will reach 400,000 barrels of oil per day by next year.

West Qurna-2 has an estimated 13 billion barrels of oil in reserve and is located approximately forty miles from the city of Basra.

(Source: Gulf News)

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GKP Shares Surge on Shaikan Update


By John Lee.

Sharess in Gulf Keystone Petroleum surged as much as 10 percent by lunchtime on Wednesday, after teh company issued an update on the its operations at Shaikan, its key producing asset:

The Company remains focused on achieving the target of 40,000 barrels of oil per day (“bopd”) of production capacity from the Shaikan production facilities (“PF-1″ and “PF-2″) in line with our Half Year Report schedule published on 28 August 2014. The Company’s staffing levels in the Kurdistan Region, including all key international contractors, returned to normal in the first half of September.

In the period since 28 August 2014, Shaikan PF-1 and PF-2 production has been achieving stable rates of approximately 23,000 gross bopd from three wells at PF-1 and two wells at PF-2. The work on the flowlines to connect additional production wells, Shaikan-7, -8 and -10 later in 2014 is on-going.

Trucking operations from PF-1 and PF-2 continue with approximately 70% of the current production trucked as export crude oil to the Turkish port of Dortyol and sold to the international market by Powertrans, an authorised transportation and marketing agent of the Kurdistan Regional Government’s Ministry of Natural Resources (“KRG” and “MNR”).

Seventeen cargoes totalling approximately 4.0 million gross barrels of Shaikan crude oil have been sold to the international market since the Shaikan crude oil export sales began from Dortyol in January 2014.

As previously announced, constructive discussions surrounding a payment cycle for past and future Shaikan export crude oil sales are progressing with the MNR, while the Company is awaiting further payments for export sales.

Approximately 30% of the current Shaikan production is being sold to domestic buyers in the Kurdistan Region. Since the publication of the Half Year Report, the domestic market has been providing steady revenue with approximately 220,000 barrels gross sold since 28 August 2014 generating US$9.4 million in gross revenues. The cash receipts associated with these sales as at 30 September were US$5.9 million.

The Company’s Q3 2014 Interim Management Statement will be published on 30 October 2014.

John Gerstenlauer (pictured), Gulf Keystone’s Chief Executive Officer commented:

Receiving steady revenues from our domestic sales is positive as we continue our constructive discussions regarding a stable payment cycle for past and future export sales.

“With all personnel now back in country, we are making good progress and look forward to reaching our target of 40,000 gross barrels of oil per day.

“We continue to manage our expenditure in a prudent manner in order to maximise production, whilst actively pursuing options regarding the Company’s 20% working interest in the Akri-Bijeel Block.”

(Sources: GKP, Yahoo!)

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