Preparations are being made for a fourth auction of oil and natural gas exploration zones. This will be in line with the country's aim to rival Saudi Arabia as one of the world’s leading oil producers.
Iraq’s official statistics reveal that oil reserves are pegged at 143.1 billion barrels, the fourth largest in the world. However the former oil minister who is now deputy prime minister Hussain al-Shahristani says the country has potential reserves of over 214 billion barrels.
Iraq’s Oil Ministry revealed that 12 new exploration zones will be auctioned off on Wednesday May 30th – Thursday 31st May 2012. All of the exploration zones are in remote areas which in turn makes them vulnerable to insurgent attacks.
The zones are mainly situated in Western and Central Iraq and companies who win the licenses will have to be able to commit to spending $90 million – 200 million.
Analysts state that Shahristani (Pictured) initially aimed to boost production to 10 million – 12 million bpd by 2017, this will not occur due to the underdeveloped infrastructure, the boost in production has been pushed back to 2020. “While the government’s most ambitious targets suggest 12 million – 13 million bpd by 2020 is theoretically possible, an output plateau of around 6 million – 7 million appears more likely” according to Oxford Analytica. Even this would earn the Iraqi Government $1 billion per day to fund on-going national reconstruction.