Page 4 - DMEA Week 34

DMEA COMMENTARY DMEA

US firms sign Iraq energy deals

$8bn worth of deals were signed last week between US energy firms and the

government of Iraq as Baghdad continues pivot away from Iran

IRAQ FIVE US oil & gas and power firms signed deals factor leading to major protests and civil unrest.
worth a total of $8bn last week during a state visit Chevron agreed a framework deal with the
WHAT: to Washington by top Iraqi diplomats. The news Ministry of Oil (MoO) to enter into exclusive
Deals were signed comes as Baghdad continues to seek external negotiations for an exploration, development,
between the Iraqi support in building out its energy sector and and production contract in the country’s south-
government and pivoting away from Iran, which had become ern Dhi Qar Province.
five US energy increasingly influential over the past five years As reported by Middle East Oil & Gas
companies focusing or so. (MEOG) last week, this will lead to the further
on oil production, gas The deals were signed by Prime Minister development of the Nassiriya oilfield in Dhi Qar
capture and electricity Mustafa al-Kadhimi during a ceremony at the Province. The field has a production capacity
generation. White House, which was attended by US Pres- of 90,000 barrels per day of crude from an esti-
ident Donald Trump and Energy Secretary Dan mated 4.36bn barrels of recoverable reserves,
WHY: Brouillette. Al-Kadhimi was joined by Iraqi though output is around 15,000-20,000 bpd
The country’s power Minister of Oil Ihsan Abdul-Jabbar Ismail and lower. Chevron is reported to be discussing fur-
sector has struggled Minister of Electricity Majid Mahdi Hantoush. ther exploration work on the asset.
badly and Baghdad “As two of the top oil producers in the world, The MoO has previously spoken of inten-
remains reliant on the United States and Iraq share an appreciation tions for the field to produce above 100,000 bpd
neighbour Iran for gas for how energy shapes our economies and can and such a target will likely be included in any
and electricity. strengthen our respective security,” Brouillette agreement.
said in a press release. Meanwhile, Iraq’s intention to build out
WHAT NEXT: He added that together, he and the Iraqi dele- its gas capture and utilisation capabilities was
Iraq has said that it will gation had “laid the groundwork for commercial highlighted in deals with services firms Baker
reduce imports from partnerships worth up to $8bn [that are] key to Hughes and Honeywell. The former agreed to
Iran, but this will depend Iraq’s energy future.” further collaboration on flare gas-to-power
greatly on the progress opportunities, and the deployment of oilfield
made in capturing gas, Deals services and equipment, while the latter agreed
and grid connectivity. The deals emphasise Baghdad’s focus on improv- to advance the development of the Ar Ratawi
ing the country’s connectivity, and while oil pro- gas project.
duction and exports are likely to remain the key Progress on gas capture will be comple-
source of wealth for generations to come, the mented by deals with General Electric and Stel-
lack of reliable access to electricity has become a lar Energy. GE signed three agreements that will

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