Custom Search

According to a document obtained by Reuters from Iraq's oil ministry, Iraq's Zubair oilfield will reach its peak output target of 1.2 million barrels per day (bpd) by the start of 2017.

The Zubair consortium plans to invest around $18 billion to upgrade the southern Iraqi field, spending $2.8 billion in 2011, $4.9 billion in 2012, $3.9 billion in 2013 and nearly the same in 2014, and $3.1 billion in 2015

Italian oil company Eni is the lead partner with 32.81 percent, and Iraq's Missan Oil Company holding 25 percent, Occidental Petroleum Corp 23.44 percent, and South Korea's KOGAS 18.75 percent.

The document also showed output projections for Zubair were 300,000 bpd at end-2011, 400,000 bpd at the start of 2013, 600,000 bpd at the start of 2014, 800,000 bpd in 2015 and 1 million bpd by the start of 2016.

The group won the right to develop Zubair in 2009 following the country's first auction of oil contracts since the 2003 U.S.-led invasion. The field was not initially awarded in the auction, but a deal was reached in subsequent negotiations under which the group will be paid a remuneration fee of $2 a barrel.

(Source: Reuters)

Iraq's oil ministry has issued a list of the 41 companies qualified to participate in its fourth energy bidding round in January:

ATPECO  - Japan

Bashneft - Russia

BP - UK

Chevron Corp - United States

CNOOC - China

CNPC - China

Edison - Italy

Egyptian General Petroleum Corp - Egypt

Eni Iraq - Italy

ExxonMobil - United States

Gazprom - Russia

Hess Corporation - United States

INA-Industrja Nafte - Croatia

Inpex Corp - Japan

ITOCHU Corp - Japan

Japex - Japan

JOGMEC - Japan

JX Nippon Oil and Gas - Japan

Kogas - South Korea

Kuwait Energy - Kuwait

Lukoil - Russia

Mitsubishi Corp - Japan

Mitsui Oil - Japan

Mubadala Oil - United Arab Emirates

Occidental Petroleum - United States

OJSC Oil Company Rosneft - Russia

OJSC TNK-BP Holding - Russia

ONGC Videsh Ltd - India

Pakistan Petroleum - Pakistan

Petro Vietnam - Vietnam

PetroChina - China

Petronas - Malaysia

Premier Oil - UK

PT Pertamina - Indonesia

PTTEP International Holding - Thailand

Royal Dutch Shell - UK/Netherlands

Sonangol - Angola

Statoil - Norway

Sumitomo Corp - Japan

Total - France

TPAO - Turkey

Advertising Feature

International oil and gas companies from 70 countries together with key Iraqi oil and gas industry experts will be gathering at the Landmark Hotel, London from 12-14 July for the latest edition of CWC Iraq Petroleum conference.

The event will focus on the next phase of developing Iraq’s oil and gas resources as well as the current and future upstream opportunities.

Conference Producer and Project Manager Nawar Abdulhadi commented:

“With Iraq seeking increasing support from international oil, gas and service companies for its economic development, Iraq Petroleum 2011 will provide the largest gathering of over 300 senior level executives and industry experts from over 90 companies worldwide, providing the ideal forum for networking and building relationships.”

The conference programme will look at the latest developments from an exclusive line-up of government and industry experts including H.E. Thamir Ghadhban, Chairman of the Advisory Commission to the PM of Iraq, H.E Ali Al Dabagh, Minister of State, Iraqi Government Spokesman, and many other government figures. On the other side, the Iraqi Parliament will be represented by H.E. Haider Al Abadi and Dr Adnan Al Jananbi and many other key Iraqi oil industry representatives will take part at the event.

A post conference workshop will follow the main programme, with Clyde & Co organising a negotiator roundtable discussion focusing on Iraq’s oil and gas contracts. This one day interactive workshop will update investors on the upcoming fourth bid round, the right joint ventures and will take delegates through a step by step guide on forming joint ventures and managing the after contract signature challenges.

Industry support for the conference is massive. Sponsors include:

• Upstream Principle Sponsor: Crescent Petroleum;
• Service Principal Sponsor: Baker Hughes; and,
• Conference Sponsors: ExxonMobil, Statoil, Shell, Total, Occidental, ENI, Jawar Al Khaleej Shipping L.L.C, Oil Serv, Huawei, IAG, Olive Group, Mott MacDonald, Mubadala, Standard Chartered, Technology Partners, SKA Group, and OIEC.

For further information visit: http://www.cwciraqpetroleum.com/

Iraq is open for business, and American companies should make an effort to invest there, Secretary of State Hillary Clinton (pictured) has said, according to a report from CNN.

The Secretary was addressing the Business Forum Promoting Commercial Opportunities in Iraq, which included executives from companies as far-ranging as Occidental Petroleum, JP Morgan Chase, General Electric, Microsoft and Lockheed Martin in a round-table discussion aimed at getting companies focused on commercial opportunities in Iraq despite its current "tough environment."

Secretary Clinton said, "President Obama and I and our government believe strongly that expanding economic opportunity is as essential as building democratic institutions. We think they go hand in hand. And in particular, it's very important for people going through the changes that are sweeping the region and that Iraq has, in many ways, been a leader in demonstrating, to believe and to see that democracy delivers: Is your life better or not? Do your children have a better opportunity or not?

"And this is clearly not a job for government alone. It is a very important partnership that has to be forged. Businesses like those represented here at this table create jobs, provide livelihoods, increase standards of living, give hope to individuals and their families. And what government should do, whether it's in the United States or in Iraq, is to be a good partner, to help create the conditions for investment and growth that will be broadly spread and create a ladder of economic opportunity for those willing to work hard, to acquire the education and skills required in the modern world.

A bomb attack on an oil storage depot in Iraq’s Zubair oilfield set one tank ablaze and halted pumping from the station, sources said on Sunday.

AKnews reports that firefighters have got the flames under control, but 27,000 cubic meters of oil have been lost.

Four devices were planted, one started the fire, two were defused and one exploded damaging an empty tank.

Dhiya Jaffar, head of the state-run South Oil Company, told Reuters that the explosion had not affected pumping to Al Fao [Al Faw] port, from which crude oil is exported.

"Production has been adjusted so daily production levels and export levels are not affected. Exports are continuing at the same rate," Jaffar told Reuters.

In recent years there have been fewer attacks on the oil infrastructure, but sporadic assaults still occur. The pipeline taking oil north to Turkey has been a particular target.

Italy’s ENI, U.S.-based Occidental Petroleum and South Korea’s KOGAS signed a 20-year deal with Iraq to develop Zubair. They set an eventual output target of 1.2 million barrels per day.

(Sources: Reuters, AKnews)

Reuters reports that Iraq's state-run Iraqi Drilling Company has started work at the Zubair oil field under a $250 million contract to drill 23 new wells in the field.

Director Idrees al-Yassiri said the two-year contract also included overhauling 63 old wells in Zubair.

"We have started executing the contract awarded to us by ENI ... The total expected production after completing the project will be more than 250,000 barrels per day from these wells," Yassiri said during a trip to the oilfield.

Italy's ENI, U.S.-based Occidental Petroleum and South Korea's KOGAS signed a 20-year deal with Iraq to develop Zubair. They set an eventual output target of 1.2 million barrels per day.

The Iraqi company has also floated a tender to purchase five drilling towers and has invited foreign companies to bid, Yassiri said, without giving further details.

(Source: Reuters)

BP and its partner China National Petroleum Corporation (CNPC) will be the first companies to be paid back by the Iraqi government for developing Iraq's supergiant Rumaila oil field, a senior Iraqi oil official told Dow Jones Newswires.

"The first company that we are going to pay back costs and remuneration fees to will be BP," Abdul Mahdy al-Ameedi, head of the Iraqi oil ministry's petroleum contracts and licensing directorate, told the news agency.

Ameedi said payment to BP is expected to start either in March or April. He didn't provide further details.

Iraq signed over the last 14 months some 12 deals to develop one of the country's vast oil fields. According to the terms of the service contracts Iraq signed with the firms, Baghdad has to start paying back the costs of developing these fields and remuneration fees when they achieve a 10% increase in production.

BP said last month that it had raised production at Rumaila by more than 10% above the initial level of 1.066 million barrels a day, but Ameedi said in a previous interview with Dow Jones Newswires that Rumaila is now producing almost 20% more oil than before, or 1.275 million barrels a day.

For every extra barrel of oil production BP and CNPC squeeze out of the field above the 10% milestone, they will receive a payment of $2. They would be also paid back costs for developing the field, which holds some 17 billion barrels of oil reserves.

BP had said that it alone would invest some $15 billion in the project during the 20-year contract. Independent oil industry sources had said that BP and CNPC would make up to 15% profit from total revenues of the Rumaila oil field.

Companies such as Eni, Italy's largest oil company in terms of reserves, along with Occidental Petroleum and Korea Gas Group (KOGAS), would be also paid back this year as they have already met the 10% increase from the giant Zubair oil field, which has estimated proven reserves of 6.5 billion barrels.

(Source: Dow Jones)

The oil minister, Abdul Karim al-Luaibi, has been busy in the few days since his appointment. Not only has he announced that exports from the northern Kurdistan region are to resume, but he has also promised that the focus will be on rebuilding the decayed oil infrastructure, according to the Arab Times.

Al-Luaibi, who has a lot of experience in the sector, has said that in addition to rebuilding infrastructure the priority will be to increase export capacity from the south to 4.5m barrels per day from around 1.6m bpd.

The increase is to be found in two fields: the Rumaila field, holding 17.8bn barrels of oil and being developed by BP and China's CNPC, and the Zubair field, being developed by Italy's Eni, the US's Occidental Petroleum Corp and South Korea's KOGAS.

However, Samuel Ciszuk of analysts IHS Global Insight is worried that improvements in infrastructure to transport and export oil cannot keep up with the rapid increase in production, due to a lack of financial resources and "infrastructural bottlenecks."

(Source: Arab Times)

Iraq's daily oil production rose to 2.5 million barrels, the biggest since 2003, a spokesman for the oil ministry said on Wednesday.

“The daily oil production rose by 10% through cooperation among national and foreign companies,” Essam Jehad told Aswat al-Iraq news agency, pointing out that this is the highest production since 2003.

Iraq’s newly appointed oil minister said the country’s daily oil production has increased by 100,000 barrels a day to 2.5 million barrels a day.

Abdul-Karim al Luaibi said the increase came from two major southern oil fields that are being developed by foreign companies: the Rumaila field, which is being developed by Britain's BP and China's CNPC, and the 4.1 billion barrels Zubair field, which is being developed by Italy's Eni and partners Los Angeles-based Occidental Petroleum Corp and South Korea's KOGAS.

He added that his top priority is to develop Iraq’s dilapidated oil infrastructure and increase export capacity from southern terminals to 4.5 million barrels a day, from the current 1.6 million barrels a day.

The minister’s statement on Wednesday marked his first full day in office.

(Sources: Aswat al-Iraq, Bloomberg)

The following update on output at Iraq's oilfields comes from Early Warning, citing a report from UPI:

Rumaila: Iraq's biggest field with the equivalent of 17.8 billion barrels of oil. That makes it the fourth largest oil field in the world. It contains around 15 percent of Iraq's oil. It is operated by BP and the China National Petroleum Corp (CNPC).

Production is 1.052 million bpd and is expected to reach its initial production rate of 1.065 million bpd by the end of the year, Jafaar says. That's three years ahead of schedule.

West Qurna 1: Contains 8.7 billion barrels. Exxon Mobil of the United States and Royal Dutch Shell secured the production contract in 2009. Production has been slipping but is expected to hit the IPR of 285,000 bpd within a year.

West Qurna 2: Holds 12.9 billion barrels and is operated by a consortium headed by Russia's Lukoil and StatoilHydro of Norway. Peak production of 1.8 million bpd is expected by the end of 2012, sustainable for more than a decade.

Majnoon: With reserves of 12.6 billion barrels, this is one of the top Iraqi fields and lies near the border with Iran. It is operated by Royal Dutch Shell and Petronas, which say they have boosted production from a paltry 46,000 bpd to 70,000 bpd, rising eventually to 1.8 million bpd.

Zubair: Operated by a consortium of Italy's ENI, the U.S. Occidental Petroleum Corp. and the Korea Gas Corp. (KOGAS) of South Korea. It has reserves of 4.1 billion barrels. Production is 200,000 bpd, up from 183,000 bpd in 2009. That's expected to eventually reach 1.2 million bpd.

Halfaya: Contains 4.1 billion barrels and is operated by the China National Petroleum Corp. Production is running at 3,600 bpd but potential output has been pegged as high as 535,000 bpd.

The Baghdad government expects production from just three of these fields -- Rumaila, West Qurna 2 and Zubair -- to hit 7 million bpd within six years.

(Source: Early Warning)