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By John Lee.

Oil services company Petrofac has shrugged off worries that its performance will be hit by the unrest in Iraq.

In a trading statement on Tuesday, the company said:

"Our operations in Iraq are south and east of Baghdad and represent less than 5% of the Group's expected revenues for 2014.

"While we continue to monitor events closely, there has been no significant impact on our current operations to date."

(Source: Petrofac)

By John Lee.

Turkish-based ERGIL, a worldwide specialist in engineering, construction and manufacturing for oil, gas, water, chemical and petrochemical industries has announced that it has been enlisted as an approved supplier/contractor by the Kurdistan Regional Government Ministry of Natural Resources in Erbil, Iraq. As an official party, ERGIL is now qualified to participate in international and local tenders.

ERGIL manufactures storage tank equipment, such as flame arresters, breather valves, gauge hatches, floating roofs, and floating suction pipe. ERGIL also provides many other products for energy industry including pressure vessels, storage and process tanks and firefighting systems.

Oktay Altunergil, CEO of ERGIL commented:

“The approval of ERGIL will allow us to focus on emerging growth opportunities in Kurdistan Region. ERGIL has a proven track report of successful execution of projects for the leading oil and gas companies such as Shell, BP, Schlumberger and Petrofac, and I am very confident of ERGIL’s successful growth in the region.”

(Source: Ergil)

By John Lee.

Iraq has announced the award of two contracts totalling nearly a billion dollars to Britain's Petrofac and China's CPECC, Reuters reports.

The deals, for services at the super-giant Rumaila field near Basra, were worth $535.8 million for Petrofac and $425 million for China Petroleum Engineering & Construction Corporation.

Rumaila is a field of key strategic importance for Iraq, with an estimated recoverable reserves of 17 billion barrels, currently being operated by a consortium of BP and CNPC. Successful development of the field will be crucial if Iraq is to realise its ambition of 9 million bpd production.

The field, which was discovered in 1953, represents approximately 12% of Iraq's known reserves, located roughly 2400 metres below ground.

(Source: Reuters)

By John Lee.

In its final results announcement this morning, Petrofac gave the following update on its operations in Iraq:

Maintenance services, Iraq

In August 2013, we were awarded a second contract by Gazprom Neft Badra B.V. (Gazprom) on the Badra oil field, situated 160 kilometres southeast of Baghdad. Worth US$95 million over three years, we will provide maintenance engineering, maintenance execution and support services.

The award builds on a previous contract to carry out the EPC work on the first phase of the field's processing facilities. Iraq is an important geography for us, and this award reflects our ability to provide quality maintenance and engineering services on technically and logistically challenging projects in the region.

Operations and maintenance services, Iraq

In October 2013, we announced a contract extension with SOC for its Iraq Crude Oil Expansion Project. The 12-month extension, worth around US$100 million, includes additional scope for operations and maintenance services.

The extension follows the original award made in 2012, which covered operations and maintenance services on offshore facilities, including: an offshore platform, metering station, two single point moorings, subsea pipelines and tanker operations, all based 60 kilometres offshore the Al Fao Peninsula in Southern Iraq.

The extension covers two additional single point moorings and a central metering and maintenance platform. During the first year of the contract, we achieved some significant milestones on behalf of our customer SOC, including the export of 240 million barrels of oil and one million man-hours worked without a lost time incident.

By John Lee.

Oilfield service company Petrofac has announced a contract extension from South Oil Company (SOC) for its Iraq Crude Oil Expansion Project.

The 12-month extension, worth around US$99 million includes the second phase of the project and will see the Company provide an additional scope of operations and maintenance services.

The extension follows the original award made in 2012 for phase one of the project which covered operations and maintenance services on the offshore facilities including an offshore platform, metering station, two single point moorings (SPMs), subsea pipelines and tanker operations, all based 60km offshore the Al Fao Peninsula in Southern Iraq. The extension, relating to phase two, covers two additional single point moorings (SPMs) and a Central Metering and Maintenance Platform (CMMP).

Mani Rajapathy, Senior Vice President MENA/CIS, Petrofac Offshore Projects & Operations, said:

"Over the past 12 months we've achieved some significant milestones on behalf of our customer SOC, including the export of 240 million barrels of oil and one million man-hours worked without a lost time incident (LTI).

"The contract is a great example of project execution including our ability to deliver work successfully and safely in a logistically complex working environment. It also further enhances our position in Iraq, a key geography for our business, and continues a collaborative relationship with a valued customer, SOC."

Dyeyaa Jaafar Hyjam, Director General, Southern Oil Company:

"When we awarded this contract in 2012 we stated that increasing the export of crude was a key driver for us and Petrofac has helped us to deliver on that. Petrofac is focused on operational excellence and safe project execution making them an attractive supplier on this strategically important project. I look forward to continuing to meet our safety and export milestones with Petrofac as our partner."

The original contract was awarded in August 2012 for 12 months following a three month mobilization period and was worth approximately US$100 million. The extension comes into effect in November 2013 and there is a further one-year extension option available to SOC.

(Source: Petrofac)

By John Lee.

The Wall Street Journal and Reuters report that Iraq has shortlisted 12 international companies to build the new $18-billion oil export pipeline to Jordan, the country's first such pipeline in decades.

Iraq's oil ministry has chosen these companies from a list of more than 80 international firms which submitted their credentials to build a section of the 1,040-mile pipeline from Basra to Jordanian Red Sea port of Aqaba.

The short-listed companies and consortiums are:

• Lukoil (Russia);
• China National Petroleum Corporation (CNPC);
• Marubeni Corporation (Japan);
• Mitsui (Japan);
• Toyota Tsusho (Japan);
• Punj Lloyd (India) and Mass Global International (Iraq);
• Saipem (Italy);
• Daewoo International Corporation (Korea);
• Consolidated Contractors Company (CCC) (Greece);
• Go Gas (India), Larsen & Toubro (L&T) (India), and Fius Capital (Dubai);
• Petrofac (UK) and Stroygazconsulting (SGC) (Russia); and,
• Orascom (Egypt) and Petrojet (Egypt).

It is understood that the State Company for Oil Projects (SCOP) will invite the short-listed companies to receive the tender package, and then submit their offers by November or December.

Iraq and Jordan signed a preliminary agreement in April to build the section of the pipeline that would stretch from an Iraqi oil pumping station in Haditha, west of Iraq, to Aqaba. The rest of the pipeline, which is 680 kilometers long, linking a Basra pumping station with the one in Haditha would be built and financed by the Iraqi oil ministry.

Iraq hopes the pipeline will make it less dependent on Persian Gulf export terminals, providing an alternative route if Iran closes the Strait of Hormuz.

A third section of the pipeline, running to Syria's Banias port in the Mediterranean, has been postponed because of the conflict in the neighboring country. It would have a capacity of 1.25 million barrels a day.

(Sources: WSJ, Reuters)

Petrofac has been awarded a second contract by Gazprom Neft Badra B.V. on the Badra Oil Field, situated 160km southeast of Baghdad City in the Republic of Iraq.

Worth US$95 million over three years, the contract was awarded to Petrofac's Offshore Projects & Operations (OPO) business to provide maintenance engineering, maintenance execution and support services.

The win builds on a previous contract to carry out the engineering, procurement and construction (EPC) work on the first phase of the field's processing facilities. OPO will now provide maintenance services including the provision of a computerised maintenance information management system and related processes and procedures, maintenance execution and associated support services in relation to the processing facilities, equipment and associated infrastructure.

Bill Dunnett, Managing Director, Petrofac OPO said:

"Iraq is a key geography for us and this award reflects our ability to provide quality maintenance and engineering services on technically and logistically challenging projects in the region. We've been working in Iraq since 2010 and have steadily grown our footprint in the country.

"Today we're working on four major developments in Iraq and we opened our country headquarters in Rumaila, earlier this year. Following our work on the first phase of the project this award is also an excellent example of Petrofac's ability to provide a lifecycle service to our customers and I'm delighted to be continuing our working relationship with Gazprom."

(Source: Petrofac)

By John Lee.

In its final results for the year ended 31st December 2012, oil and gas service provider Petrofac issued the following updates on its operations in Iraq:

Badra oilfield development project, Iraq

In February 2012, we were awarded a US$330 million lump-sum EPC contract by Gazprom for the first phase of the Badra oilfield development project. We are providing detailed design, engineering, procurement, construction, pre-commissioning, commissioning and start-up work on the Badra development's central processing facility, which comprises three crude oil processing trains. The first phase of the project is expected to come on stream in the second half of 2013, with final completion scheduled during the second half of 2015.

Inspection, maintenance and repair contract, Iraq

In November 2012, we won a further inspection, maintenance and repair contract for the Rumaila oil field in southern Iraq with our joint venture partner, China Petroleum Engineering & Construction Corporation (CPECC). The US$229 million contract was awarded by BP Iraq NV (BP), via the Rumaila Operating Organisation (ROO), following a competitive tender. The three-year contract, which is worth more than US$160 million to Petrofac, covers the inspection, maintenance and repair of degassing stations, rotating machinery and cluster pumping stations and came into effect on 1 November 2012.

Offshore operations contract, Iraq

In August 2012, we secured a contract worth approximately US$100 million to provide offshore operations and maintenance services for the Iraq Crude Oil Expansion Project. Awarded by Iraq's South Oil Company (SOC), the 12-month contract commenced following a three-month mobilisation period. There is also additional scope for the contract to be extended via two one-year contract extension options. Offshore Projects & Operations will provide operations and maintenance services for the new oil export facilities situated approximately 60 kilometres offshore the Al Fao Peninsula in southern Iraq. The facilities include: an offshore platform, metering station, single point moorings, subsea pipelines and tanker operations.

(Source: Petrofac)

By John Lee.

WesternZagros Resources has announced the appointment of Mr. William (Bill) Jack to the position of General Manager Kurdistan, to be resident in Iraqi Kurdistan, effective February 1, 2013.

This appointment follows the decision by Mr. Ian McIntosh, Vice President, Kurdistan Business Unit, to retire in January 2013 after three years of valuable service.

"Ian has been an important member of the Company's executive and has built our Kurdistan organization into a highly effective team. Among his many contributions, Ian was instrumental in quickly preparing the Sarqala-1 well for an extended well test. We wish Ian the very best," said Simon Hatfield, WesternZagros Chief Executive Officer. "We are, at the same time, delighted to welcome Bill to the WesternZagros team. His international experience is very well suited to our ambitious exploration and appraisal plans."

As General Manager Kurdistan, Mr. Jack will be a member of the Executive Management Team, and will assume responsibility for government liaison and in-country administration. Mr. Jack's extensive background encompasses more than 30 years of progressive leadership in international oil and gas roles, having spent the majority of his career with BP on projects in the United Kingdom, Middle East, Russia, Australia and North America. His most recent appointment was General and Country Manager, Tunisia for Petrofac. Mr. Jack holds a Bachelor of Science, Mechanical Engineering from University of Glasgow.

(Source: WesternZagros)

By John Lee.

Petrofac has won a further inspection, maintenance and repair contract for the Rumaila oil field in Southern Iraq with its joint venture partner, China Petroleum Engineering & Construction Corporation (CPECC). The US$229 million contract was awarded by BP Iraq NV (BP), via the Rumaila Operating Organisation (ROO), following a competitive tender.

The three-year contract, which is worth more than US$160 million to Petrofac, will be led by its Offshore Projects & Operations (OPO) business. The contract covers the inspection, maintenance and repair of degassing stations, rotating machinery and cluster pumping stations and came into effect on 1 November 2012.

Marwan Chedid (pictured), Chief Executive of Petrofac's Engineering, Construction, Operations & Maintenance (ECOM) division, commented:

"We are delighted to have been awarded a further contract for the Rumaila field. This award is testament to Petrofac's ability to deliver to a high standard in Iraq and builds on the success we have achieved over the past year in this field. Alongside our partner CPECC, we look forward to developing further our relationship with BP Iraq and the Rumaila Operating Organisation and helping to ensure a safe and successful future for this flagship field."

(Source: Petrofac)