By John Lee.
Britain's Premier Oil is teaming up with Russia's Bashneft to develop Iraq's oil exploration block 12.
In an update to the markets on Thursday, Premier said:
"Subject to ongoing discussions with the authorities in Iraq, Premier has agreed to join Bashneft on Block 12, an 8,000 km2 block in the underexplored Salman Zone in southern Iraq, with 30 per cent equity. The block contains a variety of leads at various stratigraphic levels with estimated resources in excess of 1 billion barrels. The current plan is to acquire seismic data over the block in 2013."
Simon Lockett (pictured), Chief Executive of Premier, commented:
“We look forward to an increasingly material exploration programme over the next 12 months."
Abdul-Mahdy al-Ameedi, director of the oil ministry's contracts and licensing directorate, told reporters has was also happy for more companies to get involved.
Last month Iraq awarded Bashneft rights to develop the field, having previously rejected the government’s proposed fee of $5 per barrel of oil equivalent.