By John Lee.

Iraq has reportedly approved contracts in a fifth bidding round for gas exploration contracts.

According to Reuters, the exploration deals relate to the development of fields in the eastern governate of Diyala that are expected to produce more than 750 million cubic feet of natural gas within 3 years.

The contracts have been criticised by IBN Expert Blogger Ahmed Mousa Jiyad – https://www.iraq-businessnews.com/2018/05/16/5th-round-oil-licences-poor-management-dubious-contracts-bad-results/

(Source: Reuters)

By John Lee.

Iraq has reportedly approved contracts in a fifth bidding round for gas exploration contracts.

According to Reuters, the exploration deals relate to the development of fields in the eastern governate of Diyala that are expected to produce more than 750 million cubic feet of natural gas within 3 years.

The contracts have been criticised by IBN Expert Blogger Ahmed Mousa Jiyad – https://www.iraq-businessnews.com/2018/05/16/5th-round-oil-licences-poor-management-dubious-contracts-bad-results/

(Source: Reuters)

By John Lee.

Iraq has reportedly approved contracts in a fifth bidding round for gas exploration contracts.

According to Reuters, the exploration deals relate to the development of fields in the eastern governate of Diyala that are expected to produce more than 750 million cubic feet of natural gas within 3 years.

The contracts have been criticised by IBN Expert Blogger Ahmed Mousa Jiyad – https://www.iraq-businessnews.com/2018/05/16/5th-round-oil-licences-poor-management-dubious-contracts-bad-results/

(Source: Reuters)

By John Lee.

The trial has begun in London of three British businessmen accused of conspiring to pay bribes totalling $6m (£4.6m) to win contracts in Iraq worth $800 million.

According to the UK’s Serious Fraud Office (SFO), Monaco-based Unaoil bribed Iraqi officials to help Dutch-based SBM Offshore [Single Buoy Moorings], and Singapore’s Leighton Offshore, to secure the contracts between 2005 and 2013.

The Guardian reports that Ziad Akle (44), Unaoil’s territory manager for Iraq, Stephen Whiteley (64), who was a vice-president at SBM until 2009 before joining Unaoil as its manager for Iraq, and Paul Bond (67) SBM’s sales manager for the Middle East, have all pleaded not guilty.

The trial is expected to last three months.

(Sources: The Guardian, Bloomberg)

By John Lee.

The Palestinian Authority has reportedly filed a formal request to Israel to allow the import of fuel from Iraq.

Palestinian Prime Minister, Mohammed Shtayyeh, told Israel’s Haaretz newspaper that although the request was made four months ago, Israel has yet to respond.

He said:

“Fuel is our biggest expense … The cheaper fuel from Iraq will reduce the pressure on our budget considerably.”

More here.

(Source: Haaretz)

Gulf Keystone Petroleum (GKP) has issued an operational and corporate update in advance of the Company’s full year 2019 results which are scheduled to be released on 26 March 2020.

Operational

  • Average gross production for 2019 of 32,883 barrels of oil per day (“bopd”), meeting original 2019 gross production guidance.
  • Current production rates from the field at c.40,000 bopd.
  • The side-track to the SH-9 well, designed to assess the gas reinjection potential of the Jurassic formation, reached total depth on 27 December 2019.
  • The SH-9 well is currently being tested. GKP and its partner MOL will then review plans for gas management, in consultation with the Ministry of Natural Resources.
  • In order to optimise the cost and production benefits from the drilling campaign, the sequence of wells will now be SH-L then SH-I, both of which will be drilled from the same pad and will produce into PF-2, which has available processing capacity.
  • The rig is currently being mobilised to drill the SH-L production well.
  • Full oil export from Shaikan via pipeline following commissioning of the PF-1 export line on 10 December 2019.
  • Safety remains a core focus. However, following over 530 Lost Time Incident (“LTI”) free days, an LTI occurred in December as a result of a road traffic accident.

Corporate

  • Cash balance of $192 million as at 20 January 2020.
  • The Company returned value to shareholders by paying dividends of $50 million in 2019 and to date repurchasing c.$35 million of shares out of $50 million in aggregate of share buyback programmes previously announced (with the Company today separately announcing its intention to complete the final $10 million tranche of such programmes).
  • Ian Weatherdon joined the Company on 13 January as Chief Financial Officer and Executive Board member.

Outlook

  • With the continued development of the Shaikan Field, the Company expects to increase average production in 2020 by more than 30% year-on-year to 43,000-48,000 bopd.
  • Debottlenecking and facility upgrades remain on schedule.
  • On track to reach the 55,000 bopd gross production target at Shaikan in Q3 2020.

Jon Ferrier, CEO, commented:

2019 saw GKP continue to realise the benefits of the Company’s recent turn around. In a year in which we returned significant value to shareholders, through both our maiden dividend and share buyback programmes, we also benefited from the increased operational tempo. This resulted in the first steps along the road to a significant production increase from Shaikan, and we are pleased to confirm today that we achieved our original 2019 gross production guidance.

“Looking forward, the pace of the development of Shaikan continues with the drilling and investment in our facilities, in order to deliver our growth trajectory. With a robust balance sheet and confidence in regular payments, we expect to be fully funded for our work programme and continue to return value to shareholders.

(Source: GKP)

By John Lee.

The head of Trade Bank of Iraq (TBI) has reportedly said that the bank would stop processing payments for Iranian gas imports if a US sanctions exemption expires next month.

Faisal al-Haimus told AFP:

“As a bank, the most important thing we have is that we are compliant (with international regulations). That’s why people trust us.”

Iraq relies heavily on Iran to support its struggling electricity sector.

When the United States imposed sanctions on Iran’s energy sector in 2018, it granted Iraq a series of temporary waivers to allow it to buy gas from Iran.

More here.

(Source: AFP)

By John Lee.

BP has reportedly finished its work at Iraq’s giant Kirkuk oilfield.

According to Reuters, sources confirmed that the decision followed the expiration of its $100-million exploration contract at the end of December, at which point there was no agreement on the field’s expansion.

It quotes a source at BP as saying:

“In 2013, BP signed a letter of intent (LOI) with the North Oil Company of the Iraq Ministry of Oil to support field activity studies in Kirkuk. As planned, in December 2019 BP completed field work, studies and recommendations.”

Another source said that the results of the study were “below expectations” and “not encouraging for BP to extend its operations.

Full report here.

(Source: Reuters)

By John Lee.

The International Energy Agency (IEA) has warned that Iraq is a “potentially vulnerable” energy supplier.

In its Oil Market Report, it says that in the medium term, “heightened security concerns might make it more difficult for Iraq to build production capacity“.

More here.

(Source: IEA)