Page 7 - MEOG Week 16 2022

MEOG PRICES & PERFORMANCE MEOG

Iraq continues upstream push

while sticking with OPEC+ decision

IRAQ IRAQ’S top driller this week provided updates across Basra, Kirkuk and the centre of the coun-
on its efforts to support the state’s upstream push try. The focus of its work has been fields oper-
while the oil ministry said Baghdad remains ated by international firms, with IDC drilling
committed to the deal reached among the mem- 120 wells at Rumaila, 37 at Zubair and helping
bers of the OPEC+ group. reclaim up to 20 wells at West Qurna-1.
Iraqi Drilling Co. (IDC) director general Bas- He also noted “the imminent signing of a
sim Abdul Karim said this week that the com- contract for 22 wells in the Buzurgan oilfield”
pany is working to support the Ministry of Oil’s with CNOOC, having agreed a deal for 150 wells
(MoO) plans to expand oil production capacity at the same field last year.
from the current 5mn barrels per day (bpd) to Abdul Karim also reported this week that the
8mn bpd by 2027. company had completed the drilling of a well at
Noting the ministry’s planned E&P projects the Gharraf oilfield on behalf of Malaysian oper-
targeting resources in the south-eastern wet- ator Petronas. He said that the well was drilled to
lands as well as offshore the al-Faw peninsula, a total depth of 3,389 metres by the IDC drilling
Abdul Karim said IDC “continues to sign more rig and is one of 28 it has been contracted to drill
strategic co-operation agreements with […] under a turnkey deal.
international drilling companies” having deals in Abdul Karim added that the rig has already
place with American firms Halliburton, Weath- begun creeping mobilisation to the next drilling
erford and Schlumberger; Chinese companies location – J120P – meaning that the move would
including Bohai and Zhongman Petroleum be swifter than if it needed to be dismantled first.
and Natural Gas Group (ZPEC); Azerbaijan’s Petronas holds 45% in the technical services
SOCAR and an as-yet unnamed Russian firm. contract (TSC) for the 1.3bn-barrel Gharraf
He said that co-operating with international field, located around 85 km north of Nassiriyah
firms will support IDC in drilling in offshore and city. It is partnered by Japan Petroleum Explora-
semi-submerged locations, “as well as training tion (JAPEX) with 30% and state-owned North
and qualifying the company’s staff in line with Oil Co. (NOC). The licence was awarded dur-
the development of technologies and expertise ing Baghdad’s second international licensing
in the field of diverse drilling globally”. round in late 2009. The consortium is currently
Abdul Karim’s comments follow state working to develop capacity from 70,000 bpd to
moves to tap undeveloped resources and add to 230,000 bpd.
reserves.
In January, the Iraqi National Oil Co. (INOC) OPEC+ commitment
finally concluded a deal agreed in 2019 – delayed With the head of the state oil marketer Somo
by the Covid-19 pandemic – for its Oil Explo- Alaa al-Yasiri saying this week that Iraq’s exports
ration Co. (OEC) subsidiary to collaborate with are running at around 3.4mn bpd, the MoO reit-
the state-owned China National Offshore Oil erated its commitment to the output restraint of
Corp. (CNOOC) on an onshore/offshore explo- the OPEC+ group.
ration project. This will see the Chinese firm Ministry spokesman Assem Jihad said: “Iraq
target a 530 square km area offshore the Al-Fao is within the agreement of the OPEC + countries,
peninsula with OEC focusing on a connected and is included in the schedule of production
120 square km onshore area, southeast of the increases that are distributed to all countries.”
6.4bn barrel Zubair oilfield. He added: “We are committed to the deci-
The MoO is also looking to explore four large sion of the OPEC+ countries that monitor the
areas in the south-east, described to Middle oil market and set a schedule for increases when-
East Oil & Gas (MEOG) by an MoO source as: ever the oil market sees the need to pump more
Area A (between Nasiriyah and Block 10); Area oil”, noting that the latest uptick was 400,000 bpd.
B (between Nasiriyah and Gharraf); Area D Jihad added that “oil markets are affected
(east of Nasiriyah) and Area E, which covers the by several factors, including wars, political and
marshlands of Dhi Qar. health tensions, and the increase and decrease
Meanwhile, Abdul Karim said that IDC has in demand for oil. We note that the Rus-
begun work on 43 wells at the Majnoon oilfield, sian-Ukrainian war has caused an increase in
which will be completed within two years, while demand due to a lack of supplies, and therefore
also carrying out projects at oilfield clusters there is a rise in oil or gas prices”.™

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