Iraq NEWS

Bloomberg) --Iraq is discussing a “giant” agreement with French oil giant Total SE to build large infrastructure installations, develop oil fields and produce gas, Oil Minister Ihsan Abdul Jabbar told Asharq News in an interview that aired on Saturday.The agreement is giant, and the volume of the investment exceeds $7 billion,” the minister said.

Iraq said OPEC+ oil cartel is unlikely to change its production policy at next month’s meeting and repeated promises to deliver overdue output cuts. Iraq has a limit of 3.86million barrels per day for first three months of the year under the current agreement. Jabbar said Iraq will pump 3.6million barrels a day this month and cuts production by 200,000bbls a day.

Iraq has reduced annual supplies of Basra crude oil to several Indian refiners by up to 20 per cent for 2021. The supply cuts to India followed a $2.5 billion oil prepayment deal between SOMO and Chinese state oil trader Zhenhua Oil Corp for 48 million barrels of Basra crude.

Iraq’s government agreed to sign a contract with JGC Corp to build a 55,000 barrels per day refinery in the southern region of Basra. The refinery will produce fuels including liquified petroleum gas, gasoline and gasoil, estimating the cost of the facility at $4 billion.

Basra Oil Co. has extended Petrofac’s Engineering & Production Services division’s contract for the offshore Iraq Crude Oil Export Expansion Project by six months. Petrofac has worked with BOC for seven-and-a-half years as operations and maintenance service provider, helping to raise daily crude exports beyond 2 MMbbl. The terminal, which handles around 50% of Iraq’s crude oil exports, is 60 km (37 mi) offshore the Al Fao peninsula, southern Iraq.

CNPC-owned China Petroleum Engineering & Construction Corp (CPECC) has landed the $203.5 million worth sour gas treatment contract in Iraq. The engineering contract is part of the 29-month long project which aims at building 4.39 million cubic meter-sour gas treatment facility for Iraq’s Majnoon oilfield. The field is currently operated by state-run Basra Oil Co, and produces around 240,000 bpd, which will be later boosted to 450,000 bpd.

Iraq has informed about OPEC's plan to cut down on the crude output. This possibility is being weighed over China's coronavirus epidemic. OPEC will hold a meeting with "joint technical committee" in Vienna on Tuesday and Wednesday. "The technical committees are discussing the recommendations, which they will elevate to their ministers. Any further cut to outputs would only be announced in a ministerial meeting", said Iraq's oil ministry.

If sources were to be believed, oil supermajor BP has decided to withdraw from Iraq’s Kirkuk oilfield. BP's $100 million exploration contract lapsed with no agreement on the field’s development, dealing a major setback to Iraq’s hopes to enhance its oil output. The pullout comes as the energy companies re-evaluate their activities in Iraq amid political turmoil and escalating tensions between the US and Iran.

Iraq’s oil ministry, yesterday, informed about Iraqi oil exports dropping to 3.428 million barrels per day (bpd) in December. Oil exports from the country averaged 3.5 million bpd in November. The spokesman for the oil ministry, Asim Jihad informed that exports from Iraq’s southern Basra terminals reached 3.326 million bpd, down from 3.4 million bpd in November.

Iraq has decided to increase production from oil fields in Basra after the production from Nassiriya oil fields were stopped abruptly by protestors. The move aims at preventing the country's export and production from declining. Iraq can also increase the production from Majnoon oil fields to cope up with the situation. However, it is a tense situation as Nassiriya produces 80-85,000 BOPD and this is the first time when protestors have shut an entire oilfield.

Oil prices remained high in the international market on Monday, even though the traders expected lower fuel prices. The price of WTI increased by 1% to $61.73. Brent Crude rose 27% in 2019. Tensions in the Middle East escalated on Sunday, as the United States carried out airstrikes in Iraq and Syria. U.S. officials have also warned of “additional actions”.

CNPC’s subsidiary, China Petroleum Engineering & Construction Corp (CPECC) has secured a $121 million engineering contract in Iraq. The contract requires CPECC to renovate the facilities currently used for gas extraction during crude oil production at West Qurna-1 oilfield. The project is slated for completion in 27 months. The West Qurna-1 oilfield was developed by Exxon Mobil and produces 480,000 barrels of crude oil per day.

Oil Ministry of Iraq is in conversation with energy giant ExxonMobil. Both the parties are discussing over a deal to enhance Iraq's southern oil infrastructure. Iraq has also made it clear that its deal with BP and Eni was for the construction of two seabed oil pipelines for its southern exports through the Gulf. And also, it was not a part of the $53 billion 30-year southern mega-project.

Vagit Alekperov, the President of Lukoil, has met the Iraqi Minister of Oil, at the St. Petersburg International Economic Forum. They discussed the development of West Qurna-2 project and agreed to consider the possibility of early commissioning of Block 10 of Eridu field. Both the parties also expressed their interest in gas processing and petrochemical projects in Iraq.

ExxonMobil decided to pull out its staff from Iraq as a “precautionary and temporary” measure. Energy Minister of the Middle East nation has termed this decision as “unacceptable and unwarranted”. He further argued that “This withdrawal may send the wrong message about the situation in Iraq, and that’s something we reject”. He has also sent a letter to Exxon officials asking for clarification and enquiring the workers to return.

British oil firm, Genel Energy has inked an agreement to acquire Chevron’s stakes in Iraq oil blocks. Genel will gain ownership of 30% interest in the Sarta licence and 40% interest in the Qara Dagh licence. Until a specific production target is reached in the Sarta license, Genel will account for 50% share of ongoing field development costs. The firm will become the operator of the Qara Dagh licence.

In an interview last week, director for refineries at BPCL said that the downstream major will import 5mn tonnes of various grades of Iraqi crude in 2019. He also said that importing more crude from Iraq will let BPCL to displace some portion of the other Middle East crude. BPCL enhanced the capacity of Kochi refinery to 15mn tpa, which will allow them to process more dirty cheap crudes.

Leading oil services firm, Halliburton has secured a well drilling contract from an Eni-led consortium in Iraq. Over the next two years, the Houston-based firm will utilize up to six rigs to drill development wells in the Zubair Oil Field in Iraq. Italian oil major, Eni leads a consortium of Oxydental, Kogas and Missan on the Zubair field, which has over more than four billion barrels of reserves.