THREE foreign consortia have been awarded the contracts to develop three key gas production assets in Iraq.
The Iraqi government has awarded rights to develop Akkas, Mansouriya and Siba, which together hold 11trillion cu.ft of gas. This is in contrast to a year ago when none attracted bids the first time around.
Oil minister Hussain al-Shahristani said at an auction in Baghdad on October 20 that signing the contracts was imminent and that they had been submitted to the Iraqi parliament for approval.
The Akkas field in western Iraq went to a joint venture between Korea Gas Corporation (Kogas) and the Kazakhstan national oil company KazMunaiGaz.
The losing bid for the field was from the Total and Turkiye Petrollelri Anonim Ortakligi (TPAO) joint venture.
Akkas, discovered in the western Anbar province in 1998, holds 5.6TCF and presently has six wells
The Siba field in southern Iraq was awarded to TPAO (40%) with Kuwait Energy Company (60%) JV. The losing bid for Siba was from KazMunaiGaz.
Siba, found in 1968 in Basra, has 1.1TCF of gas and currently has three wells,
Kuwait Energy and TPAO agreed to produce 100million cu.ft of gas a day at a price of $7.50 per barrel of oil equivalent.
Iraq’s energy ministry accepted the only bid for the Mansouriyah Field in Iraq’s Diyala Province near the Iranian border, which was submitted by Kogas, TPAO, and Kuwait Energy.
This consortium pledged to produce 320million cu.ft of gas a day for $7 per barrel oil equivalent produced.
Mansouriya, discovered in 1979, potentially holds 4.5TCF of gas and currently has four wells.
The 45 companies that bid last year were invited to bid for the three fields, where Iraq wants to raise production four-fold. The October 20 auction was delayed twice from September 1.
Among other companies qualified to bid but which lost out were Itochu, Oil & Natural Gas Corp, Statoil, Mitsubishi and TNK-BP, the ministry said.
Meanwhile, Shell, which earlier secured the right to develop Iraqi crude deposits, is working to capture and use about 700million cu.ft of associated gas that’s currently going to waste by being flared in-situ in the oilfields.
Iraq’s $12.5billion venture with Shell may be able to start exporting the fuel by 2015 when output from the country’s southern fields meet domestic demand.
Iraq currently produces about 2.3million barrels of oil per day, plus around 1.1billion cu.ft of associated gas daily.