22 May 2010 - oilvoice
The movement of overseas oil firms into Iraq, to develop the country's vast supply of natural resources, continues. This week, the Iraqi government has signed a development agreement with both the China National Offshore Oil Corporation (CNOOC) and Turkey's state-backed oil firm Turkiye Petrolleri Anonim Ortakligi (TPAO) to develop the Missan oil fields in the Middle Eastern nation.
The agreement is the 11th major deal designed to boost production at Iraq's oil fields. Furthermore, the pact is of major significance to CNOOC, as it attempts to increase its global onshore upstream profile.
CNOOC's attempts to enter a number of foreign markets, such as the US, have been rejected owing to concerns over Chinese control of strategically important energy assets. As a result, the firm has long been attempting to enter markets where it is likely to be greeted with less hostility, such as Iraq.
Iraq's Missan complex is estimated to hold recoverable crude oil reserves of 2.5 billion barrels. The development deal incorporates three constituent fields within it, including Abu Ghirab, Buzurgan and Fakka.
In 2008, Missan recorded a flow rate of 115,000 barrels per day (bpd), but this figure is set to increase more than threefold. With the inking of the deal, CNOOC and TPAO combined and set an output target of 450,000 bpd by 2016.
The Chinese major has long been interested in accessing Iraqi supply of natural resources. CNOOC originally made a bid to develop the Missan fields in Iraq's first licensing round in 2009. The bid was made in conjunction with fellow Chinese state-run firm Sinochem, before the latter exited the deal citing a poor remuneration fee, providing an entry opportunity for TPAO. Under the newly inked deal, CNOOC will hold a majority 63.75% in the venture, while TPAO will hold an 11.25% stake. The remaining 25% will be held by an Iraqi state company.
According to Hussein al-Shahristani, Iraq's oil minister, Iraq's ongoing licensing of its oil fields isn't going to stop with Missan.
Indeed, al-Shahristani has also stated that Iraq was in talks with a number of firms interested in developing its three Middle Furat oil fields: Kifl, West Kifl and Merjan. The trio of fields are located south and west of the city of Karbala in the centre of the country.
Combined, the three Middle Furat fields are estimated to hold recoverable reserves of around 600 million.