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By John Lee.

Radioactive material that went missing in Iraq in November has been found, apparently undamaged, on Sunday near a patrol station in Zubair.

The chief of the security panel at the Basra Provincial Council told Reuters:

"A passer-by found the radioactive device dumped in Zubair and immediately informed security forces which went with a special radiation prevention team and retrieved the device.

"After initial checking I can confirm the device is intact 100 percent and there is absolutely no concern of radiation."

(Sources: CNN, Reuters)

(Radioactive material image via Shutterstock)

By John Lee.

The International Atomic Energy Agency (IAEA) has told Reuters of a theft a radioactive source in Zubair.

The industrial radiography device is described Ir-192 in a shielding container, which is classified as a Category 2 radioactive substance, meaning that if not managed properly it could be fatal to someone exposed for a period of hours to days.

SGS, the testing company which was using the material at a Weatherford site, issued the following statement:

"SGS Turkey was hired by the oil services company Weatherford to perform standard non-destructing testing activities on pipes at an oil field in Southern Iraq. The equipment used for these services is equipped with a low level radioactive source.

"The site where these operations are conducted is fully secured and guarded by security guards under the responsibility of the owner of the site. SGS does not assume any responsibility for the site security and does not control accesses. SGS is one of many contractors active on the site.

"When not in use, the equipment and radioactive source are stored in a secured bunker designed for that effect and provided by Weatherford. The disappearance of the equipment occurred while the equipment was stored in the Weatherford bunker. The loss was discovered on November 3, 2015.

"SGS Turkey/Erbil Branch Office immediately notified the Iraqi authorities and fully cooperated with the investigation conducted by the competent authorities."

Meanwhile, Weatherford has told Reuters:

"Weatherford has no responsibility or liability in relation to this matter because we do not own, operate or control sources or the bunker where the sources are stored.

"SGS is the owner and operator of the bunker and sources and solely responsible for addressing this matter."

(Sources: SGS, Reuters)

(Radioactive material image via Shutterstock)

By John Lee.

In its results for the first quarter of 2015, oil services company Weatherford said it expected "a positive cash outcome on the Zubair project in Iraq as milestones are achieved and continued control of capital expenditures,"

The company added that "reduction in working capital balances and managing a cash neutral end to the Zubair project in Iraq which will contribute enough to more than offset any reduction in earnings."

Bernard J. Duroc-Danner, Chairman, President and Chief Executive Officer commented:

"Our approach is to treat this down cycle as an opportunity to become a much leaner, more efficient and streamlined organization. Our key focus areas of cost management, cash generation and talent development will pay dividends in improved market share, margins and reduced debt levels by year end."

(Source: Weatherford)

By John Lee.

Shares in Gulf Keystone Petroleum (GKP) were up 4 percent this morning after the company provided an operational and corporate update:

Significant progress has been made since the Field Development Plan ("FDP") for the Shaikan field was approved in June 2013. In July 2013 the Company commenced commercial production, marking Gulf Keystone's transition to an operator with revenue generation. In December 2013 crude oil exports from the Shaikan field commenced.

Shaikan (75% working interest; Operator)

Shaikan Production Update

Gulf Keystone is pleased to announce the commencement of crude oil exports from the Shaikan field.

In line with the Company's marketing strategy, which is being developed in co-operation with the Ministry of Natural Resources of the Kurdistan Regional Government, the first tendered cargo of between 30,000 tonnes (198,300 barrels) and 33,000 tonnes (215,000 barrels) of Shaikan crude was trucked to Turkey in December and will be loading at the port of Dortyol this month.

A second tender is underway for two further cargoes of similar size of Shaikan crude, which are expected to be loaded later this month and during February. Sales realisations are expected to be in accordance with the terms of the Production Sharing Contract for the Shaikan Block ("Shaikan PSC") and will reflect transportation and quality adjustments.

The first Shaikan production facility ("PF-1") is in operation with two wells currently tied to the facility, namely Shaikan-1 and -3. The flowlines from Shaikan-4 to PF-1 are now complete and the well has been worked over as a Jurassic Sargelu producer prior to being tied to PF-1 in early 2014.

Work at the second Shaikan production facility ("PF-2") is nearing completion with electrical and instrumentation work ongoing. The Shaikan-2, -5, and -10 wells have been completed as Jurassic Sargelu producers and the flowlines from these wells to PF-2 are currently being laid.

Current average oil sales from PF-1 stand at between 9,000 and 10,000 barrels per day of export quality crude. The Company will provide an update on well performance and combined production capacity of PF-1 and PF-2 as the additional four wells become operational.

By John Lee.

Amarinth, a leading company specialising in the design, application and manufacture of centrifugal pumps and associated equipment to the Oil & Gas, petrochemical, chemical and industrial markets, has secured a new order in Iraq to supply a further eight API 610 OH2 A-Series pumps to the Zubair Initial Production Facility.

Last year, working with its agent in the region Horizon Development International, Amarinth secured its first business in Iraq to provide twelve API 610 11th edition Super Duplex OH2 A-Series pumps in Super Duplex for the produced water treatment package for the Zubair Initial Production Facility located in Basra in southern Iraq.

Following the successful delivery of those pumps on a short 24 week delivery, US giant oil services company Weatherford International, which holds the oil field facilities contract for Iraq's Zubair oil field, placed a further order for eight pumps to the same specification, on the same 24 week delivery.

This brings the total order value of pumps supplied by Amarinth to the Zubair Initial Production Facility to over $1.5M. Amarinth are also in on-going discussions with Weatherford International to supply more pumps to the same project.

Iraq is proving to be a rapidly expanding market for suppliers to the oil and gas industry and Amarinth has been building quickly on its initial successes. The company has received approved vendor status from both Lukoil (Russia's second largest oil company) and ENI and is progressing opportunities in the region with Iraq’s state owned oil companies South Oil Company and Midland Oil Company.

Oliver Brigginshaw, Managing Director of Amarinth, added:

“We are delighted to have secured this further order in Iraq with the help of our agent Horizon Development International. Whilst Iraq still poses many significant challenges, having a good local agent such as Horizon Development International is essential for trading in the country.

"We are currently seeing further significant growth opportunities in the region and the work we have completed to date to establish a foothold in the market, and these new reference sites coming online within Iraq within the next 12 months, will leave us in a strong position to win further business in the region.”

(Source: )

By John Lee.

Iraq has awarded oil drilling deals with a combined value of $348 million.

Associated Press reports that Weatherford picked up two drilling contracts, one for nearly $95 million and another for $82.4 million.

Another contract worth $96.7 million went to China's Bohai, while COSL, a division of the China National Offshore Oil Corporation (CNOOC), won a contract for $73.8 million.

The deals relate to work at oil fields in Maysan province that are being developed by China's state-owned CNOOC.

(Source: Associated Press)

(Picture: a Weatherford rig at Bazirgan oilfield in Maysan)

Gulf Keystone has announced that further to the approval of the Field Development Plan for the Shaikan field, a world class commercial discovery, announced on 26 June 2013, the Company has commenced its development drilling programme with the spudding of Shaikan-10. In parallel, production operations from the newly commissioned Shaikan production facility ("PF-1") are scheduled to commence shortly.

Shaikan-10 to launch aggressive development drilling campaign

Shaikan-10, the Company's first development well, spudded on 5 July 2013, launching a development drilling campaign as part of the approved phased development of the Shaikan field, which Gulf Keystone operates. The well is being drilled with the Weatherford 842 rig, which previously drilled Shaikan-8, also part of the agreed phased development. This rig also drilled the Shaikan-1 discovery well in 2009 and the Bijell-1 discovery well in 2010.

Shaikan-10 will be followed by a minimum 3-rig development and production drilling programme, which will commence in early 2014.

Shaikan-10 is intended to become a production well and is to be tied to the second Shaikan production facility ("PF-2"), which is currently under construction. Analogous to PF-1, it is of modular design and its production capacity will be of 20,000 barrels of oil per day ("bopd"). Shaikan-2 and -5, already completed as production wells, will also be tied to PF-2.

PF-1, which has now been completed and commissioned, when combined with PF-2 later in the year, will allow the Company to achieve its immediate short-term production target of 40,000 bopd.

Commenting on today's announcement, John Gerstenlauer (pictured), Chief Operating Officer, said:

"It is a recognised fact that Gulf Keystone has done outstanding work during the exploration phase and we continue targeting significant exploration upside of the Shaikan field with Shaikan-7, which is currently being drilled.

"Our next immediate target is to complete the Company's transition from an exploration to a key producer in the Kurdistan Region in 2013. The spudding of Shaikan-10 is yet another step in the right direction.

"The implementation of our Field Development Plan has started and we will shortly commence production from one of the world's largest onshore conventional oil & gas developments. Focusing on our production milestones agreed with the Ministry of Natural Resources, we are working hard to get to 40,000 bopd of Shaikan production from PF-1 and PF-2, and then to progress to 150,000 bopd within 3 years and 250,000 bopd within 5 years."

(Source: GKP)

By John Lee.

Gulf Keystone has announced the commencement of the Company's drilling campaign to explore deeper, yet untested horizons of the world class discovery at the Shaikan field, which the Company operates.

Shaikan-7, the first deep exploration well on the Shaikan block, is targeting the mid to lower Triassic and, potentially, Permian horizons, spudded late on Sunday 16 June 2013. The well is being drilled with the Weatherford Rig 319 (3000HP) close to the crest of the Shaikan structure, approximately 1 km east of the Shaikan-1 discovery well.

Shaikan-7 is being drilled to the lower Triassic to evaluate the potential for significant quantities of light oil and identify commerciality of the deeper Triassic reservoir. The well is then expected to penetrate the Permian, the deepest undrilled horizon to date on the Shaikan structure.

This vertical well is planned to reach a total depth below 4,500m in the Permian and the drilling is expected to take about 9 months.

Commenting on today's announcement, John Gerstenlauer (pictured), Chief Operating Officer, said:

"As we are about to commence implementation of our Field Development Plan for the Shaikan discovery and start Jurassic production from the newly constructed Shaikan production facility, the spudding of our first deep exploration well adds a new and exciting dimension to Gulf Keystone's work programme in 2013.

"With Shaikan-7, we hope to confirm our expectations of major reservoirs beneath the deepest horizon drilled to date and add to what is already recognised as one of the world's largest onshore conventional oil & gas developments."

(Source: GKP)

Gulf Keystone notes today's update by MOL Hungarian Oil and Gas Plc., the operator of the Akri-Bijeel Block in the Kurdistan Region of Iraq (in which Gulf Keystone has a 20 per cent working interest), on its extensive exploration and appraisal programme.

Bakrman-1 Exploration Well Discovery

Bakrman-1, the first exploration well to target the Bakrman structure on the Akri-Bijeel Block, has made a new Triassic discovery. This is the second discovery on the block following the Bijell discovery made in 2010.

Bakrman-1 spudded in May 2012, 32 km to the north-west of the Bijell-1 discovery well. The well was drilled to a total depth of 4,100 metres in the Kurra Chine B formation in the Triassic, following which a well testing programme commenced, targeting reservoir zones in the Jurassic and Triassic. Two open hole tests and three cased hole tests have been performed to date. According to the operator, the second open hole well test performed at 3,930-4,100 metres MD (measured depth) in the Kurra Chine B formation in the Triassic resulted in calculated daily flow rates of approximately 2,616 barrels of light (32 to 35 degrees API gravity) oil per day and a gas rate of approximately 5.86 million standard cubic feet per day. The well testing programme is ongoing and is expected to be completed in April 2013.

Gulak-1 Exploration Well

Gulak-1, the fourth exploration well to be drilled on the Akri-Bijeel block and the first exploration well to target the Gulak anticline, spudded in July 2012 and has been drilled 21 km to the east from the Bijell-1 discovery well and 5 km to the south from the Bekhme-1 exploration well to a total depth of 3,641 metres in the Kurra Chine B formation in the Triassic. The well test programme, consisting of five tests, has now been completed. In the course of the DST#4 performed at 2,385-2,420 metres MD in the Sargelu and Naokelekan formations in the Jurassic, minor inflows of between 22-30 degrees API oil were encountered. Following the completion of the DST#5, it is proposed that the well will be suspended.

By John Lee.

Missan Oil Company has announced that the US company Weatherford has successfully completed an oil well at the Bazargan field.

It has also rehabilitated another well in the same field, and one at the Faqa oil field.

According to a report from AIN, this brings the number of wells Weatherford completed at Bazargan to 17, from a total of 20 in the contract.

(Source: AIN)