Iraq Still Hopes to Award Joint Nassiriya Oilfield, Refinery Deal

Iraq's deputy oil minister, Ahmed al-Shamma, said that Iraq still hopes to award a contract for the development of the 4.4 billion barrel Nassiriya oil field and the construction of a dedicated 300,000 bpd export refinery as one package.

Iraq excluded Nassiriya from its three previous bidding rounds for oil and gas licences.

According to Platts, Baghdad had been in drawn-out negotiations with a consortium led by Japan's Nippon Oil to develop the field, but the ministry eventually assigned management of the field to the state-run South Oil Company.

Shamma said Iraq has also already prepared infrastructure at the southern port of Fao [Faw] needed for product exports from a refinery at Nassiriya. "We don't want to develop the Nassiriya field and then send crude to Basra as it will put an extra burden on our export facilities [in the south]. We already have enough oil in Basra," he said.

"We prefer oil to go to the refinery; this will provide the investor with a better deal."

"We have coordinated the building of four new dedicated jetties at Fao for products -- for gasoil, gasoline, jet fuel and fuel oil," Shamma said. In September last year, Iraq said it would hold an auction for rights to develop Nassiriya if the three companies pre-qualified to bid are interested and the oil ministry decides to turn the project over to foreign companies.

Nippon Oil, Spain's Repsol, Italy's Eni, and US firm Chevron have all submitted proposals to develop the field. Repsol was later disqualified for signing contracts which Baghdad considers illegal with the Kurdistan Regional Government.

(Source: Platts)

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