Nov 22 2011 |
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Iraq To Sign Water Injection Deal With 4 Firms Sat -Official
Tuesday, Nov 22, 2011
(This item was originally published Monday.)
By Hassan Hafidh
Of DOW JONES NEWSWIRES
BAGHDAD (Dow Jones)--Iraq is expected to sign Saturday an agreement with four international oil companies to build a multi-billion-dollar oil field water injection plant, a senior Iraqi oil official said Monday.
Abdul Mahdy al-Ameedi, head of the Oil Ministry's Petroleum Contracts and Licensing Directorate, said U.K. super major BP PLC ( BP ), U.S. giant Exxon Mobil Corp. (XOM), Italy's Eni SpA (E) and Russia's OAO Lukoil Holdings (LKOH.RS) have agreed to build the first phase of the project, which is designed to produce some 4.2 million barrels a day of seawater to be injected into Iraqi oil fields in order to boost production.
"The development agreement of the project is scheduled to be signed Nov. 26 in Turkey," Ameedi told Dow Jones Newswires in an exclusive interview in Baghdad.
ExxonMobil was picked as operator of the project, Ameedi said.
"We will sign with it because so far there hasn't been a decision from the [oil] ministry that terminates the ExxonMobil's contract in the West Qurna 1 field," Ameedi said.
Should ExxonMobil withdraw from the project, responsibilities will be divided among the remaining three.
"We have put a provision in the agreement that if one of the four companies pulls out of the contract, the remaining three will cover for it," he said.
ExxonMobil has signed six exploration oil and gas deals with the northern Kurdish region, which is at loggerheads with the central government in Baghdad over oil, land rights and distribution of power between the regional and central governments. Baghdad has suggested the ExxonMobil accord in the north could jeopardize its contract to develop West Qurna 1.
Ameedi said the companies had already awarded small contracts to carry out pre-FEED--front end engineering and design--for the project. The agreement will call for carrying a FEED that is expected to show how much the project would cost, he said.
The water injection project aims to provide water to maintain reservoir pressure to fields such as Rumaila and West Qurna phases 1 and 2, and Zubair.
Iraq has signed a series of deals with oil majors to develop its largest oil fields and is seeking to boost production as the country pulls back from years of war and economic sanctions.
-By Hassan Hafidh, Dow Jones Newswires; +962 799 831 831; hassan.hafidh@dowjones.com
(END) Dow Jones Newswires
22-11-11 0404GMT
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