Iraq to launch 4th energy auction in late May

April 19, 2012 10:41 pm 

BAGHDAD, April 19 — The Iraqi Oil Ministry announced Thursday it will launch its fourth round of energy auction for 12 oil and gas exploration concessions on May 30-31.

"The Petroleum Contracts and Licensing Directorate (PCLD) at the Ministry of Oil announced Thursday that Iraq's Fourth Petroleum Licensing Round will take place as scheduled on May 30- 31, 2012," the ministry said in an online statement.

"The final list of prequalified companies includes a total of 47 entities, split between operators and non-operators," the statement said.

"We are happy to announce that the next bid round is on schedule. The Final Tender Protocol and the definitive model Contract have been issued to all prequalified companies," the statement quoted Abdul Mahdy Al-Ameedi, director general of the PCLD, as saying during the announcement in the Oil Ministry building.

The list did not include the U.S. oil firm of ExxonMobile which earlier signed energy contracts with the Kurdish regional government, breaking a ban imposed by Baghdad against any foreign firm that sign energy deals Kurdistan region without going through the federal government in Baghdad which is the only side that has the right to ink oil contracts.

Previously, Iraq banned all oil companies that signed deals with Kurdistan from taking part in tenders and contracts to exploit in the country's oil industry, asserting that all oil deals signed earlier by the regional government are invalid.

In 2010, the Iraqi Oil Ministry struck a deal with ExxonMobile and the Anglo-Dutch firm of Shell to develop the oil production at West Qurna-1 in southern Iraq, which has reserves of 8.5 billion barrels of oil.

Iraq is offering 12 large exploration blocks of an average size of 6,500 square kilometers for bidding, seven of which for gas and five for oil across the country.

"Winning companies, or consortia of companies, will carry out exploration, appraisal, development and production activities within the 12 contract areas," the statement said.

The aim of the fourth round is primarily to expand Iraq's natural gas production capacity to satisfy the power generation sector and create gas-based industries, as well as increase the country's oil reserves, it said.

Since the ministry launched its first licensing round in 2008, Iraq has awarded 14 service contracts for the development of discovered oil and gas fields, in addition to the Ahdeb oil contract in eastern the country.

The ministry also signed a major joint venture deal with a consortium of Royal Dutch Shell and Mitsubishi to capture and monetize associated natural gas produced in southern Iraq.

The country has proven reserves of 112 trillion cubic feet (3. 13 trillion cubic meters) of natural gas. But due to poor infrastructure, the country is only producing 1.5 billion cubic feet a day.

The country depends on oil revenues for nearly 95 percent of its budget.

In 2010, Iraq announced that its proven oil reserves had increased to 143.1 billion barrels, rising from the previous estimate of 115 billion barrels. (PNA/Xinhua)

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