baghdad: British oil major BP Plc and China’s CNPC have signed Iraq’s first major new oil deal since the 2003 US invasion for supergiant Rumaila, and Baghdad is close to finalising pacts on several other large oilfields. The agreements have the ability to turn Iraq into the world’s number three producer after Russia and Saudi Arabia. Here are facts on deals in the pipeline:
RUMAILA: BP and CNPC won the contract to boost output from the Rumaila field, Iraq’s largest, in June. Rumaila has reserves of nearly 17 billion barrels, which alone is more than all the oil held by Opec member Algeria. Rumaila is the workhorse of Iraq’s oil industry, providing just over 1m b/d of the country’s 2.5m b/d output. BP has pledged to boost output to 2.85m b/d.
ZUBAIR: Eni, Occidental and KOGAS have won a contract to develop the Zubair oilfield. Zubair has oil reserves of 4 billion barrels. Eni has pledged to boost output there to 1.125m b/d from 195,000 b/d.
WEST QURNA: ExxonMobil and Royal Dutch Shell, LUKOIL and ConocoPhillips, and two other groups led by France’s Total and CNPC are competing to develop the oilfield. West Qurna has reserves of about 8.7 billion barrels, a little less than all the oil held by Opec member Angola. Exxon and Shell have pledged to boost output to 2.1m b/d from around 280,000 b/d. LUKOIL and Conoco have set their sights on 1.5m b/d. The other targets are not known.
KIRKUK: Iraq is seeking a revised bid from a Royal Dutch Shell-led group for Kirkuk, which is currently producing 350,000 b/d. In its initial, failed bid, Shell envisioned a plateau production of 825,000 b/d. One of Iraq’s older oilfields, it has estimated reserves of 8.5 billion barrels. The field is vulnerable to fallout from tensions between Iraq’s Arab-led government in Baghdad and ethnic Kurds, who view the city and surrounding province as their ancestral home and want it included in their semi-autonomous northern enclave.
NASSIRIYA: Iraq is close to signing an engineering, procurement and construction deal for Nassiriya with a Nippon Oil Corp-led group. The largely undeveloped field is listed as having reserves of 5 billion barrels but it could be far larger. Nippon Oil Corp has projected pumping up to 200,000 b/d within two years, according to Iraqi officials, and Eni, which was originally in the running for the field, has said it could eventually have a capacity of 1m b/d.
EAST BAGHDAD: Iraq may also pursue an EPC deal for the southern part of the supergiant East Baghdad oilfield, which has 8.1 billion barrels in reserves, with Japan Petroleum Exploration Co (Japex). Japex has projected that it could pump 400,000 b/d initially from the southern portion of the field, enough to satisfy about 10 percent of Japanese oil demand.
THE SECOND ROUND: The 10 oilfields on offer on December 11-12 in the second bidding round include the supergiants Majnoon with 12.6 billion barrels, and West Qurna Phase II, where there are 12.9 billion barrels in reserves. The rest of East Baghdad is also up for grabs.
The Iraqi Oil Ministry has set a total output target from the development deals of 2.14m b/d. In its first auction, its total output target from six oilfields was exceeded by the projected plateau projection contained in just one offer — the BP, CNPC bid for Rumaila.
