Page 4 - MEOG Week 08 2022

MEOG COMMENTARY MEOG

Iraq holds talks as

gas projects progress

Iraq is working to reach agreements on gas development and supply deals
as it nears completion of a major project to improve domestic production.

IRAN IRAQ is holding talks with Halliburton and Western Desert and the Nebras petrochemical
Saudi Aramco over the development of Western project apparently key to proceedings.
Desert gas deposits as progress was announced In November, Abdul Jabbar, who is also the
WHAT: on a project to capture associated gas in the east head of the Iraqi National Oil Co. (INOC), said:
The Ministry of Oil is in of the country. “Iraq is negotiating with the [Aramco] to enter
talks with Halliburton and During a tour around events in the southern it as a partner in contracts for exploration and
Aramco to develop gas Gulf, Oil Minister Ihsan Abdul Jabbar com- investment of free gas in the new fields in the
resources in the west of mented on Iraq’s gas aspirations as well as plans Western Desert. The results of those negotiations
the country. to begin importing LNG from Qatar as it seeks are being studied by experts from the two coun-
to achieve self-sustaining production. Iraq is tries” ahead of settling the terms for long-term
WHY: home to at least 130 trillion cubic feet (3.7 tril- agreements that “satisfy aspirations and interests
Meanwhile progress is lion cubic metres) of combined associated and of both countries”.
being made on a project free gas resources. He added that the MoO has kicked off 2D
in the east that will and 3D seismic surveys across the provinces of
harness associated gas. Anbar approach Anbar and Nineveh.
Abdul Jabbar said that discussions are ongoing In mid-2020, Finance Minister and then
WHAT NEXT: with Halliburton regarding a technical partner- acting Oil Minister Ali Allawi said that Saudi
Iraq is keen to avoid the ship to develop and operate assets in the western firms would be allowed to invest in Akkas and in
gas shortages that led to Al Anbar Governorate, which encompasses the late May, little-known Saudi firm Delta Oil was
power cuts during peak area between Baghdad and the borders with Jor- reported to be under consideration as a partner
summer months and is dan, Saudi Arabia and Syria. in the project.
considering importing Speaking during a meeting of the Gas Abdul Jabbar noted that a consortium led by
gas from Qatar. Exporting Countries Forum (GECF) in Doha, US oilfield services specialist Schlumberger was
he explained that the Ministry of Oil (MoO) is in pole position to take over Akkas, with Bagh-
working with Halliburton to finalise the terms dad planning to terminate an agreement with
of their proposed agreement, adding that it Korea Gas Corp. (KOGAS).
would be signed by the Iraqi government once The field, which is estimated to contain a
appointed. total resource of 5.6 trillion cubic feet (159bn
This time around, Abdul Jabbar said that Iraq cubic metres) of gas and recoverable reserves of
would cover the cost of development, poten- around 3-3.5 tcf (85-99 bcm), is located around
tially alongside Aramco, should it decide to take 30 km from the Syrian border in the restive
part in the project, noting that separate talks are Western Desert.
ongoing with the Saudi firm to fund and develop A technical services contract (TSC) for its
Anbar’s Akkas gas field, Iraq’s largest non-associ- development was awarded to a joint venture (JV)
ated or ‘free’ gas deposit. between KOGAS and Kazakhstan’s KazMunai-
It is not the first time that Iraqi has spoken Gas (KMG) during Iraq’s 2010 licensing round,
publicly about ongoing discussions with Hal- with the partners to receive a remuneration fee of
liburton: in December, the company moved $5.50 per barrel of oil equivalent (boe).
to dispel reports that it was in line to acquire With development costs estimated at $3bn,
ExxonMobil’s 32.7% operated stake in the West production was anticipated reaching 400mn
Qurna-1 oilfield after Iraqi officials said that the cubic feet (11.3mn cubic metres) per day, but
US firm had submitted a proposal in collabora- progress by KOGAS and Turkish partner TPAO
tion with the UK’s Wood Group and American has been limited. This has largely been caused by
investment firm Twelve Seas Investment Co. its location in Anbar, a long-time stronghold of
Halliburton is working with Aramco on the IS until its expulsion in late 2017.
development of its Jafurah gas deposit in the In October, Muhammed Abed Al-Aboudi,
Kingdom’s Eastern Province. director-general of the MoO’s Reservoirs &
Talks between the Ministry of Oil and its Fields Development Directorate, was quoted
Saudi counterpart have been ongoing since 2017, as saying: “Talks are being held with IOCs
with the development of gas reserves in Iraq’s to replace KOGAS and its partners for the

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