Iraq on Sunday signed deals with Turkish, Kuwaiti and South Korean energy firms to develop two gas fields to boost production in a bid to help rebuild its energy-dependent economy. The final contract agreements came just days after Baghdad initialled a preliminary accord with Seoul's Korea Gas Corporation (KOGAS) to exploit Akkaz
field in the western province of Anbar. Sunday's deals were for Mansuriyah field in Diyala province, north-east of Baghdad, and Siba field in Basra, Iraq's southernmost province.
"We need to develop these two fields to support the ministry of electricity, so its stations can work better," Oil Minister Abdulkarim al-Luaybi said at the contract signing attended by reporters. "This is a very important day, and it represents a new beginning for the oil industry." The Mansuriyah contract was with a consortium made up of Turkey's TPAO, Kuwait Energy and KOGAS, while Siba is to be developed by Kuwait Energy and KOGAS.
Mansuriyah has estimated reserves of 4.5 trillion cubic feet (127 billion cubic metres) of gas, while Siba has 1.5 trillion cubic feet (34 billion cubic metres). An oil ministry official said the Mansuriyah deal, a 20-year contract, calls for production to be boosted to 320 million cubic feet of gas per day in six years, with the consortium receiving $7 per oil barrel equivalent produced.
The venture will be divided between Kuwait Energy, which has a 45 percent stake, TPAO with a 30 percent stake, and Iraq's state-owned South Oil Company with the remaining 25 percent.
The Siba agreement also extends 20 years and will boost production at the field to 100 million cubic feet per day in six years, with the companies involved receiving $7.50 per oil barrel equivalent.
The consortium is split between TPAO, which holds 37.5 percent, Kuwait Energy with 22.5 percent, 25 percent for Iraq's state-owned Oil Exploration Company, and 15 percent for KOGAS. As with a dozen oilfield development contracts awarded to foreign firms over the past two years, Iraq prefers per-barrel service fees rather than production-sharing contracts.
Baghdad needs the energy revenues from the increased production to rebuild a war-battered economy and fill chronic electricity shortfalls.
Comments
Comments are closed.