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Iraq oil plan includes drilling 15 oil wells

Baghdad, April 21, 2010

The initial development plan agreed by Royal Dutch Shell, Malaysian partner Petronas and Iraqi oil officials includes inviting oil service firms to drill 15 new wells, an Iraqi oil official said.

The plan also includes building two new crude processing plants with a capacity of 50,000 barrels per day each and boosting capacity at an existing processor to 120,000 bpd from 100,000 bpd, the official said, asking not to be identified.

The plan was put together at a meeting last Thursday in the southern oil hub of Basra of officials from Iraq's South Oil Co (SOC) and executives of Shell and state-run Petronas.

The two companies won the right to develop the 12.6 billion barrel Majnoon oilfield, one of the world's biggest, in the second auction held by Iraq last year of oilfield development contracts, and the contract was signed early this year.

It is one of 10 oilfield development deals that could take Iraq to third place among oil producing nations from 11th now and boost its capacity to Saudi levels of 12 million barrels per day from around 2.5 million bpd currently.

"We discussed preliminary plans to raise the output in the Majnoon oilfield and if everything goes according to the plan an output of 175,000 barrels of oil equivalent per day could be achieved in 24 months," said the SOC oil official, who was not authorized to speak to the media.

The SOC nominated Abdul Sahib Qutub, a former deputy oil minister and current adviser to Oil Minister Hussain al-Shahristani, to head the Majnoon joint management committee, the official said.

For Majnoon, the Shell-led group proposed a per-barrel remuneration fee of $1.39 and pledged to increase output to 1.8 million bpd from a current production level of around 45,000 bpd. – Reuters




Tags: Shell | Oil | Petronas | Drilling | Iraq | Baghdad |

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