By John Lee.

Russia’s Gazprom Neft has reportedly revised down its output plateau for the Badra oil field.

Denis Sugaipov, head of Gazprom Neft’s department of large projects, told Reuters that the consortium running the project has proposed setting the output plateau for the next few years at its current level of around 85,000 bpd, as the field is more geologically complex than previously thought.

This is half the level initially planned as a plateau to be reached in 2017.

The field is being developed by Gazprom (30%), KOGAS (22.5%), Petronas (15%), TPAO (7.5%), Iraqi state-owned Oil Exploration Company (25%).

According to Reuters, $4.0 billion has been invested in the plant so far, including $1 billion for a gas processing plant; another $2.5 billion is planned to be invested by 2030.

(Source: Reuters)

By John Lee.

The state-owned Korea Gas Corporation (KOGAS) has said that it has recouped its $2.49 billion investment in the Zubair oil field in southern Iraq.

According to a report from Yonhap, the company has recovered $2.53 million as of December, which exceeds its initial outlay.

The oilfield is currently producing around 360,000 barrels of crude oil per day.

The project primarily involves the drilling of more than 200 wells, the construction of treatment and storage facilities and refurbishment of the existing facilities.

(Source: Yonhap)

UK-based Petrofac has been awarded a Front End Engineering Design (FEED) modification contract for the KOGAS AKKAS B.V. Nasiriya Gas Treatment Plant (GTP) in southern Iraq.

Petrofac’s scope of work includes the modification and application of an existing field design to meet the needs of the Nasiriya GTP, and an estimation for the engineering, procurement and construction (EPC) costs in line with the revised design requirements.

Steve Webber, Senior Vice President, Engineering & Production Services East, said:

This award is testament to our engineering design capabilities, as well as our deep understanding of the market and supply chain in Iraq. KOGAS is a new client for us in a core market and we look forward to further developing our relationship through the successful delivery of this scope.

“Throughout the project, we will provide a robust FEED package for the execution of the Nasiriya GTP in alignment with KOGAS’ expectations, to ensure that it can maximise the total value of the field.

(Source: Petrofac)

A working meeting between Alexey Miller, Chairman of the Gazprom Management Committee, and Jabbar al-Luaibi, Minister of Oil of the Republic of Iraq, took place in St. Petersburg today.

The parties discussed the Badra project, which is implemented in Iraq by Gazprom Neft. Currently, the Badra field produces as much as 77,000 barrels of oil per day.

Gazprom Neft continues to construct oil and gas infrastructure, with start-up underway for a comprehensive gas treatment unit. The first and second trains of the project will go into operation in the 2nd and 3rd quarters of 2017, respectively.

Gazprom Neft is a vertically integrated oil company focused on oil & gas field exploration and development, oil refining, and petroleum product processing and marketing. The company’s largest shareholder is Gazprom (95.68 per cent); the rest of its shares are in circulation.

On May 31, 2014, Gazprom Neft started developing the Badra field located in the Wasit Province in the eastern part of Iraq. According to estimates, Badra holds 3 billion barrels of oil.

In January 2010, the consortium of Gazprom Neft, Kogas (Korea), Petronas (Malaysia), and TPAO (Turkey) signed a contract with the Iraqi Government for the development of the Badra field following a competitive tender. Gazprom Neft, as the project operator, holds a 30 per cent stake in the project, Kogas – 22.5 per cent, Petronas – 15 per cent, and TPAO – 7.5 per cent.

The Iraqi Government represented in the project by the Iraqi Oil Exploration Company (OEC) holds a 25 per cent stake. The Badra development project’s lifecycle is 20 years, with a possible five-year extension.

The cumulative oil production from Badra is in excess of 5 million tons.

Gazprom Neft allocated USD 10 million for social projects in the Wasit Province. The funds were used to build three schools, purchase computer equipment and school supplies, buy two minibuses for the University of Wasit, renovate and expand power grids in the neighboring population centers, provide local hospitals with medical equipment, and buy two ambulances.

At present, over 3,000 Iraqi citizens work at the Badra field. Gazprom Neft spent upward of USD 12 million on training programs for those workers.

(Source: Gazprom)

By John Lee.

The South Oil Company (SOC) has officially taken over the stake in the Zubair oil field formerly held by US-based Occidental Petroleum, which has withdrawn from the project.

Repressentatives of Italy’s Eni and the Korea Gas Corporation (KOGAS) signed the agreement along with the Ministry of Oil.

Mr. Laith Al-Shaher, the director general of the legal directorate in the ministry, said that output at the field has increased from 150,000 bpd in 2010 to 400,000 bpd today. There are plans to increase this to 450,000 bpd next year.

He said that Occidental was pulling out of all projects in the Middle East because of the global financial crisis and the oil prices drop.

Mr. Ahmed Fadhil, the deputy director general of SOC said his company entered the consortium with a share of 29.95 percent.

(Source: Ministry of Oil)

By John Lee.

The South Oil Company (SOC) has officially taken over the stake in the Zubair oil field formerly held by US-based Occidental Petroleum, which has withdrawn from the project.

Repressentatives of Italy’s Eni and the Korea Gas Corporation (KOGAS) signed the agreement along with the Ministry of Oil.

Mr. Laith Al-Shaher, the director general of the legal directorate in the ministry, said that output at the field has increased from 150,000 bpd in 2010 to 400,000 bpd today. There are plans to increase this to 450,000 bpd next year.

He said that Occidental was pulling out of all projects in the Middle East because of the global financial crisis and the oil prices drop.

Mr. Ahmed Fadhil, the deputy director general of SOC said his company entered the consortium with a share of 29.95 percent.

(Source: Ministry of Oil)

Dubai-based Drake & Scull International PJSC (DSI) has announced that it has been awarded a AED 226 million ($61 million) engineering, procurement and construction (EPC) contract for the construction of a water injection network installation project at the Zubair oil field in Basra, Iraq by ENI Iraq B.V. (EIBV) a subsidiary of the Italian oil and gas multinational firm ENI S.p.A.

EIBV is the Lead Contractor of the Zubair Project consortium which currently comprises EIBV, Occidental of Iraq LLC and KOGAS Iraq B.V. which is undertaking the redevelopment of the Zubair Oil Field.

Under the terms of the agreement, Drake and Scull Oil & Gas (DSOG) will oversee the Engineering, Procurement and Construction (EPC) of a gas supply pipeline system to a power plant in addition to water injection systems consisting of flow lines, trunk lines, manifolds stations and wellheads hook-up work to enhance oil recovery. Mobilization activity on the project has commenced with a scheduled completion of early 2018.

Commenting on the project award, Wael Allan, Chief Operating Officer (COO) of Drake & Scull International PJSC, said:

Drake & Scull Oil and Gas continues to achieve substantial progress and has gained a noticeable foothold in the oil and gas infrastructure construction sector in the MENA region in short period. The contract award has also raised DSI’s total project wins to AED 570 million in very challenging circumstances.

“We are confident that our high margin businesses including Oil & Gas, Rail & Infrastructure and Engineering will significantly contribute to our sustainable growth, in line with our strategy of focusing on profitability and cash generation.

Fares Khatib, Managing Director of Drake and Scull Oil & Gas added:

The Zubair oilfield contract is a positive development for DSOG, particularly as it represents our second collaboration with EIBV. EIBV had previously awarded DSOG the EPC pipeline installation contract for the Zubair oil field in 2012 which was successfully completed in 2015 on the strength of our in-house engineering management, procurement and construction capabilities. 

“Our prior experience with EIBV in Zubair oil field will prove invaluable in ensuring the successful execution of project delivery on the new project award. We are committed to leveraging the skillset and experience of our teams in Iraq & Abu Dhabi to achieve scheduled project progress and meet our completion target.

DSOG has established its credentials in undertaking large scale, complex Oil, Gas, Chemical & Petrochemical-related projects across the wider MEA region. The company has successfully delivered prominent projects such as the EPC pipeline installation Project for the Zubair oil field in Iraq.

(Source: Drake & Scull International)

By John Lee.

According to a report from Platts, South Korea’s state-owned Korea Gas Corporation (KOGAS) plans to sell a 47 percent stake in its 100 percent-controlled Akkas gas field.

The company is under pressure from the Korean government to reduce its debts.

The project was originally awarded to a consortium of Kogas and KazMunaiGas (KMG), but KMG pulled out in 2011, leaving Kogas as sole investor and operator on new contract terms.

(Source: Platts)

By John Lee.

Occidental Petroleum intends to sell its stake in the Zubair oilfield to Iraq’s state-run South Oil Company (SOC), according to a report from Reuters.

The news agency quotes ministry spokesman Asim Jihad as saying on Wednesday:

“Occidental asked the ministry for permission to sell its stake in Zubair field and the ministry is in the process of approving the request. South Oil Company will acquire Occidental’s stake.”

Occidental holds 29.69 percent of the field, with Italy’s Eni holding 41.56 percent and operating the field, while South Korea’s KOGAS has 23.75 percent and Iraq’s state-run Missan Oil Company owns 5 percent.

(Source: Reuters)

(Picture: Stephen Chazen, President and CEO of Occidental)