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Jordan And BP Sign Risha Gas Development Agreements
The Jordanian government, the National Petroleum Company (NPC) and BP on 25 October signed four agreements for the development of the Risha gas field in the Risha concession, located 360km east of 'Amman, near the Jordanian-Iraqi border. BP said in a press release issued on 26 October that subject to government and parliamentary approval, “it is to farm into the Risha concession as a partner with NPC.” NPC and BP signed a preliminary agreement for the field in January and it took 18 months of negotiations to finalize the deal (MEES, 9 February).
Jordanian Minister of Energy and Mineral Resources Khaldun Qutaishat said that under these agreements, further development of the Risha field, which is currently producing 21mn cfd, will be carried out in two phases. Under the first one, BP will spend a minimum of $237mn on exploration and evaluation in the next three-to-four years, with an option of an additional year, and the aim is to raise output to around 50mn cfd. If this phase is economically viable, BP will then start a second phase of development and production which will see it investing $8-10bn with the aim of producing between 330mn cfd and 1bn cfd of gas.
Mr Qutaishat noted that with an output of 1bn cfd, Jordan would be able to meet its domestic needs and to export the surplus. According to NPC’s chairman of the board, Fayiz Suhaimat, the government will take 50% of the output generated by the development project, with NPC and BP each receiving 25%. The agreements still need parliamentary approval, having been approved by the government on 6 October (MEES, 12 October). The Risha concession, in which the gas field covers an area of 1,500 sq km, was granted to NPC in 1996, but in 2002 the concession agreement was amended to allow participation by other parties, in a bid to further develop the field. The gas output is currently used for electricity generation at the Risha power plant. Jordan imports 96% of its energy needs, and the discovery of more gas domestically will greatly help to ease this situation. © Copyright MEES 2009.
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