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Iraq Invests to Boost Nasiriyah Oil Field

By John Lee.

Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] has ordered the state-run Dhi Qar Oil Company (DQOC) and Iraq Drilling Company (IDC) to develop the Nasiriyah oil field in Dhi Qar province.

He said the Ministry has budgeted $140 million to raise production from the current 90,000 barrels per day (bpd) to 200,000 bpd within a year.

The field has estimated reserves of 4.4 billion barrels of oil.

It was originally offered as part of a larger project, known as the Nasiriyah Integrated Project (NIP), which would include the contruction of a 300,000 bpd refinery.

In January 2018, Iraq dropped the NIP, saying it will rely on a newly formed state oil company to develop the Nassiriya oil field, and leaving only the nearby refinery project for investors.

(Source: Ministry of Oil)

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DNO Picks Up Peshkabir Production in Kurdistan

DNO ASA, the Norwegian oil and gas operator, today announced a two-thirds increase in production from the Peshkabir field in the Tawke license in the Kurdistan region of Iraq to 25,000 barrels of oil per day (bopd) following completion of the Peshkabir-4 well testing program.

The well has been placed on production at a rate of 10,000 bopd through a 72/64″ choke with 790 psi wellhead pressure through temporary, capacity-constrained test facilities and the oil trucked to Fish Khabur for export.

The Peshkabir-4 well was designed as a high angle well to assess the central part of the structure four kilometers west of the Peshkabir-3 well and drilled to a measured depth of 3,525 meters, including a 1,150 meter extended reach reservoir section. A total of 11 zones were tested and flowed between 1,500 bopd and 7,000 bopd per zone.

The next well in the 2018 field development campaign, Peshkabir-5, has been drilled seven kilometers west of Peshkabir-3 and has successfully proved the westward extension of the field. Completed in June, it is currently undergoing final testing; a total of four zones have been tested so far and flowed between 4,000 bopd and 7,500 bopd per zone.

DNO will bring this well onstream in August and expects to reach and surpass its previously announced summer 2018 Peshkabir production target of 30,000 bopd.

“The pickup in Peshkabir production puts new meaning to the fast in fast track in development of this field by the DNO team,” said Bijan Mossavar-Rahmani, DNO’s Executive Chairman.  “And we expect Peshkabir to continue to surprise to the upside,” he added.

Two other wells, Peshkabir-6 and Peshkabir-7, are drilling ahead at 3,900 meters and 3,100 meters, respectively. Peshkabir-6, a near vertical well, will explore the field’s deeper Triassic formation and establish the Cretaceous oil/water contact level. Peshkabir-7 is a high angle producer well located between Peshkabir-4 and Peshkabir-5.

The Peshkabir field was brought on production in 2017 and two drilled wells last year, Peshkabir-2 and Peshkabir-3, have produced at a constant combined rate of around 15,000 bopd.

DNO operates and has a 75 percent interest in the Tawke license, which contains the Tawke and Peshkabir fields, with partner Genel Energy plc holding the remainder. Together, output from the two fields has averaged 106,000 bopd year-to-date.

(Source: DNO)

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New Development Plan for West Qurna-2

LUKOIL and the Basra Oil Company (BOC) signed a Development Plan for the West Qurna-2 field that provides for an oil production plateau of 800 thousand barrels per day.

According to the Plan, the oil production of 480 thousand barrels per day will be reached in 2020 and 800 thousand barrels per day is expected in 2025.

These indicators will be achieved as a result of drilling and commissioning of new production and injection wells, construction and launching of oil treatment, storage and transportation facilities and facilities for gas treatment and power generation.

The experience acquired by the Company in the region, the existing infrastructure and cost compensation within the project development from the current production will ensure maximum efficiency of the project implementation.

The parties noted that due to the agreements reached, LUKOIL will remain one of the largest investors and employers in Iraq in the coming years. ​

(Source: Lukoil)

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BP signs Contract to Develop Kirkuk Oil

By John Lee.

The Ministry of Oil has announced that BP has signed a contract to develop the Kirkuk oil fields.

According to Reuters, the deal with the North Oil Company (NOC) will see BP will boost output capacity from the six fields in the Kirkuk region to more than 1 million barrels of oil per day (bpd), three times current capacity.

In the past, BP has provided technical assistance to help develop the Kirkuk fields.

(Sources: Ministry of Oil, Reuters)

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Gazprom Neft commissions Second Well at Sarqala

Gazprom Neft subsidiary Gazprom Neft Middle East B.V. has commissioned a second well — the Sarqala-2 — at its Sarqala field (within the Garmian block), located in the Kurdistan Region of Iraq (KRI).

The new well is currently producing 11,000 barrels per day (bpd), with potential to increase this to 15,000. Total daily production at the field has now increased more than two-fold, exceeding 21,000 bpd.

Sergei Petrov, General Director, Gazprom Neft Middle East B.V. commented:

“The Sarqala-2 well is operating under high reservoir pressure and temperature. But by using exceptional technical solutions in well construction we have been able to make significant reductions in operating costs, as well as bringing the project in on time.”

Denis Sugaipov, Director of Major Projects Upstream at Gazprom Neft, added:

“Thanks to the commissioning of this new well we have been able to confirm our geological prognoses and obtain updated information on strata composition at the Sarqala field. The geology of the KRI is, generally, under-researched, so this new well is of major importance in terms of gaining knowledge and experience of the field.”

First oil from the Garmian block was obtained in 2011, with commercial crude shipments from the field commencing as early as 2015. As at 15.04.2018 total cumulative production at the field stood at seven million barrels of oil.

The first phase of expanding gathering and treatment capacity to 25,000 bpd is now complete, with work continuing on expanding infrastructure to accommodate 35,000 bpd. Drilling of the Sarqala-3 well is planned for Q3 2018, completing Phase I of field development.

(Source: Gazprom Neft)

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5 Firms Shortlisted for Major Water-Injection Project

By John Lee.

According to a report from Platts, Iraq has shortlisted five international engineering companies to bid for the first phase of the Common Seawater Supply Project (CSSP), a major water-injection project that will help the country boost long-term production from its southern oil fields.

The project would take in around 5 million barrels per day (bpd) of water from the Persian Gulf, process it for field injection, and deliver it by pipeline to a half dozen fields in Basra province.

It has been under discussion for nearly a decade, and wsa priced at $12 billion when capacity was to be 10 million bpd of water.

More here.

(Source: Platts)

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DNO announces Higher Revenues, Profits, Production, Reserves

DNO ASA, the Norwegian oil and gas operator, today released its 2017 Annual Report and Accounts together with its 2017 Annual Statement of Reserves and Resources and reported improvements across key financial and operational metrics.

Annual 2017 revenues climbed to USD 347 million, up 72 percent from year earlier levels. Operating profit totaled USD 521 million, up from USD 6 million in 2016, with the recognition as other income of USD 556 million under the August 2017 Kurdistan Receivables Settlement Agreement.

Excluding the settlement agreement and non-cash impairments, operating profit in 2017 more than doubled to USD 72 million. And notwithstanding a doubling of operational spend to USD 259 million, the Company ended the year with a cash balance of USD 430 million.

Company Working Interest (CWI) production increased to 73,700 barrels of oil equivalent per day (boepd) from 69,200 boepd in 2016 (operated production in 2017 was 113,500 boepd, up from 112,600 boepd in 2016). Lifting costs last year averaged USD 3.6 per barrel of oil equivalent.

Iraqi Kurdistan

DNO’s production continues to be driven by the Tawke field in Kurdistan, where output in 2017 averaged 105,500 barrels of oil per day (bopd).

The adjacent Peshkabir field, brought on stream midyear, contributed another 3,600 bopd to bring total Tawke license production to 109,100 bopd in 2017. The Company plans to bolster production from the license with 10 new wells in 2018.

“We are committed this year to continue to outdrill, outproduce and outperform all other international companies in Kurdistan – combined,” said DNO’s Executive Chairman Bijan Mossavar-Rahmani.

At yearend 2017, DNO’s CWI 1P reserves climbed to 240 million barrels of oil equivalent (MMboe) from 219 MMboe at yearend 2016, after adjusting for production during the year, technical revisions and an increase in DNO’s operated stake in the Tawke license from 55 percent to 75 percent.

On a 2P basis, DNO’s CWI reserves stood at 384 MMboe (up from 368 MMboe) and on a 3P basis, DNO’s CWI reserves stood at 666 MMboe (up from 521 MMboe). DNO’s yearend 2017 CWI contingent resources (2C) were estimated at 99 MMboe, down from 161 MMboe at yearend 2016, following reclassification of certain contingent resources to reserves.

On a gross basis, at yearend 2017, 1P reserves at the Tawke license containing the Tawke and Peshkabir fields totaled 348 MMboe (353 MMboe at yearend 2016) after adjusting for production of 40 MMboe during the year and technical revisions; 2P reserves totaled 513 MMboe (536 MMboe at yearend 2016); 3P reserves totaled 880 MMboe (725 MMboe at yearend 2016) and 2C resources totaled 91 MMboe (211 MMboe at yearend 2016) following reclassification.

International petroleum consultants DeGolyer and MacNaughton carried out the annual independent assessment of the Tawke and Peshkabir fields. DNO internally evaluated the remaining assets.

(Source: DNO)

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Iraq to launch new “Basrah Medium” Crude Oil Grade

By John Lee.

Platts reports that Iraq plans to launch a new Basrah Medium crude oil grade “whenever logistics allow,” to provide “more stability” in existing grades.

It quotes Ali Nazar al-Shatari, the Deputy Director General of the State Oil Marketing Organization (SOMO) as saying the new grade will have an API gravity of 29-30 degrees, with 2 percent sulphur.

Basrah Heavy will remain largely the same at 23 degrees API and 4 percent sulphur, while Basrah Light will be become even lighter, rising to 34 API degrees, up from an average of 29-31 degrees currently.

(Source: Platts)

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Total may Bid for Nassirya Oil Refinery

By John Lee.

France’s Total is said to be interested in bidding to build the greenfield 150,000-bpd Nassirya oil refinery.

The Director General of the Dhi Qar Oil Company (DQOC), Ali Warid Hammood, told Reuters at the CWC Iraq Petroleum Conference in Berlin that bids are still open for the project, and that international oil companies interested in the project would be bidding as refiners only.

The project was initially offered as part of the Nassiriya Integrated Project (NIP), tying it to oilfield development. In January 2018, Iraq dropped the NIP, saying it will rely on a newly formed state oil company to develop the Nassiriya oil field, and leaving only the nearby refinery project for investors.

Hammood confirmed to Reuters that DQOC will develop the field by itself.

It is currently producing 80,000-100,000 barrels of oil per day, with plans to double capacity within three years.

(Source: Reuters)

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Iraq to Increase Oil Capacity by 40%

By John Lee.

Oil Minister Jabar Ali al-Luaibi [Allibi, Luiebi] (pictured) has said Iraq plans to increase its crude oil production capacity from 5 million bpd at present to 7 million bpd by 2022.

According to a report from Reuters, he added that Iraq needs $4 billion for new investments in its downstream oil industry, lifting refining capacity to 1.5 million bpd by 2021.

It said the increase in refining capacity would come from seven projects, some of them new and some involving the expansion of existing refineries.

(Source: Reuters)