US-based oil services company Halliburton has today announced it has signed two contracts with Eni Iraq BV to provide integrated drilling services at Eni’s Zubair oilfield in Southern Iraq.

Under the contracts, Halliburton will mobilize four to six rigs to drill development wells over the next two years.

Mahmoud El-Kady, vice president of the Iraq Area for Halliburton, said:

“We are pleased to be awarded this work and the opportunity to collaborate with Eni to engineer solutions for the development of Zubair.

“We have provided a wide array of drilling services to Eni since 2011 and signing these contracts are a testimony to our continuous commitment to safety and superior service quality.

(Source: Halliburton)

By John Lee.

The Basra Gas Company (BGC) is expected to increase production from its current level of 900 million cubic feet per day (mcf/d) to 1,050 mcf/d by the end of this year.

A statement from the Ministry of Oil on Thursday added that the project aims to reach a target of 2,000 mcf/d from the fields of Rumaila, Zubair and West Qurna 1.

Shell has a 44-percent stake in the $17-billion, 25-year BGC project, with Iraq having 51 percent, and Japan’s Mitsubishi 5 percent.

(Source: Ministry of Oil)

The oil minister of Iraq, Jabbar Ali Hussein Luaibi, and the Chief Executive Officer of Eni, Claudio Descalzi (pictured) met in Baghdad on Saturday.

During the meeting Eni’s CEO had the opportunity to outline the Company’s current activities in the country in light of the recent achievements of the Zubair field development, where the production has grown by over 100% since 2015.

The project, carried out by Eni with Basra Oil Company (BOC), has marked the fast track development of one of the largest producing oil fields in the Southern Iraq region of Basra.

Furthermore Claudio Descalzi updated the Minister Luaibi on a new 380 MW power plant which is in the final stages of construction. The plant will generate power for Zubair field and for domestic consumption in Basra Governorate.

Claudio Descalzi and Minister Jabbar discussed additional increase of Zubair production, future opportunities and development investments that would further strengthen Eni’s relationship with the country. Eni’s CEO has in fact confirmed Eni commitment in Upstream sector in Iraq and its support to the country through several initiatives.

Eni’s CEO and the Minister of Oil discussed among other things on the progress of social projects that are currently underway in the Basra Governorate in the areas of healthcare, education, through the construction among other things of one secondary school in Basra for 900 students and refurbishment of existing ones targeting total of 77 schools within the next 4 years, access to energy, through the expansion of the power plant, clean drinking water, through the overhaul of drinking water treatment plants, and new initiatives in agriculture sector which will allow creation of jobs and the development of local economy.

Finally, Eni’s CEO highlighted potential synergies related to energy projects in Iraq, a strategic lever for the Country in maximizing its use of national natural resources through project integration within the entire energy chain and double country oil production within limited time.

Eni has been present in Iraq since 2009, where it operates through its subsidiary Eni Iraq B.V., and with the ramp up of the Zubair Field Development Project (Eni 41.56%, Kogas 23.75%, BOC 29.69%, Missan 5%) the Company has become one of Iraq’s main operators in the oil sector. Eni currently operates 475,000 barrels of oil equivalent per day in Iraq.

(Source: ENI)

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)

By John Lee.

Reuters has reported that both BP and Eni have expressed an interest in developing the giant Majnoon oilfield, which Shell plans to exit next year.

Iraqi oil officials told the news agency that Iraq’s Ministry of Oil has not yet started negotiations with either company.

BP is currently developing the Rumaila field, while Eni operates Zubair.

Shell is expected to hand over Majnoon operations to the state-owned Basra Oil Company by the end of June 2018.

Both Chevron and Total have been previously reported as being interested in taking over the field.

(Source: Reuters)

Weir Oil & Gas Dubai has reportedly been awarded a contract with Eni Iraq BV to provide global maintenance services for gas compressor units and associated equipment located in the three Initial Production Facilities (IPF) plants in the Zubair oil fields in Southern Iraq.

The gas compressor units are comprised of gas engines, gas compressors, and relevant associated equipment. There are 30 compressors in total, with 18 at Hammar, six at Zubair and six at Rafidya. Weir engineers are now responsible for maintenance servicing of all compressors at each of the sites.

Ronan Le Gloahec (pictured), EMEA Regional Managing Director of Weir Oil & Gas, said:

Weir was selected for this contract due to our experience in Iraq, local footprint and know-how of the specific rotating machines and Field Maintenance methodologies.

“In addition to our state-of-the-art manufacturing facilities in Dubai and service centre in Abu Dhabi, we have a dedicated service centre in Basra, the first facility in Iraq has both API and ISO licenses.”

(Source: Oilfield Technology)

The eleventh edition of the Iraq Petroleum Conference taking place on 22-23 May 2017 in London is set to gather the Country’s industry experts to discuss the future of Iraq’s hydrocarbons sector.

Ahead of the conference, CWC Group Director Nawar Abdulhadi interviews one of the key speakers of this year’s event, Mr Loris Tealdi, Managing Director, ENI Iraq b.v. Mr Tealdi shares his experience working on the Zubair oilfield, how Eni is working towards innovation and his outlook for the future of the industry.

Nawar Abdulhadi: Why is Iraq such an important market for the global oil and gas industry?

Mr Loris Tealdi: Iraq is historically one of the most important areas in the world in term of oil reserves and production potential. In addition, there may be also future evolutions to improve gas valorisation and empower the downstream sector.

The Iraq reservoirs are of great size and excellent properties. On top the government is quite open to the application of new technology and innovation that can lead to very important results in term of production enhancement also in the short run. Eni has a story to tell here: the exceptional oil production ramp-up of over 70% that we had in giant Zubair field over the last 2 years.

 

Nawar Abdulhadi: How does the Government of Iraq and the oil and gas industry work together to drive innovation?

Mr Loris Tealdi: The drive for development is the effective deployment of new technology; here the presence of IOCs in the country and the effective know-how transfer from the industry to the brightest Iraqi personnel can be the leverage for a significant improvement from many perspectives. As far as Eni is concerned in Iraq, an important event that marked a new attitude of the country is the entry of SOC as second party in The Zubair JV replacing Occidental after its withdrawal in 2016. This event is a step change in the cooperation between IOCs and NOCs in Iraq and has the potential to strengthen win-win solutions and to further improve the deployment innovative technology In Iraq.

By John Lee.

Hundreds of people protested in Zubair on Sunday to demand jobs.

Asharq al-Aswat reports that the protesters tried to block access to oil fields managed by BP and Eni, saying that the oil is “being stolen by thieves.

Despite its oil wealth, the Basra region suffers from poor services and huge unemployment, while some locals report health issues as a result of living near the oil fields.

(Source: Asharq al-Aswat)

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.

A senior Iraqi oil official has told Reuters that international oil companies (IOCs) have warned of delays to projects to increase its crude oil output if the Iraqi government insists on drastic spending cuts this year.

Investments by IOCs are repaid with crude oil, which has become a problem since oil prices have fallen and Iraq has been struggling to find enough oil to repay the companies for their investments.

Due to budgetary pressures, Iraq has asked IOCs to cut their development budgets for a second year, but the two sides have failed so far to agree on spending levels.

BP has been asked to cut its 2016 budget for Rumaila to $2.48 billion, and to target output of 1.4-million barrels per day. (BP proposed a budget of $3.25 billion for 2015).

Lukoil is expected to cut spending to $1.26b illion and aim for a production of 400,000 bpd at West Qurna 2 project; it proposed a 2015 budget of $2.1 billion.

Eni should cut spending to $1.62 billion and aim for production of 351,000 bpd at Zubair.

ExxonMobil was asked to slash spending to $878 million and aim for output of 379,000 bpd at West Qurna 1. Last year, according to Reuters, it “insisted” on spending $1.8 billion.

Shell should cut spending to $855 million and aim for 200,000 bpd from Majnoon. Last year, it proposed a budget of $1.5 billion.

Petronas should reduce costs to $712 million and target production of 100,000 bpd at Garraf.

(Source: Reuters)