Bids in for Iraq Halfaya oil production facilities

15 March 2011

Partners plan to increase production to 535,000 b/d from 3,000 b/d currently

Petrochina, a subsidiary of China National Petroleum Corporation (CNPC) and its partners have received bids from three firms for an estimated $200m contract to build early production facilities at the Halfaya oil field in southern Iraq.

The three firms include two Chinese firms; China Petroleum Engineering & Construction Corporation and Daqing Oilfield Limited; and Malaysia’s Marine Heavy Engineering, according to a source close to the scheme.

The winning firm will build early production and gas gathering facilities at the field, which has estimated reserves of 4.1 billion barrels and lies in the Missan province along Iraq’s southern border with Iran.

CNPC leads the development of the field along with Malaysia’s Petronas, France’s Total and state-owned South Oil Company.

The partners agreed in January 2010 to boost output to 535,000 barrels a day (b/d) over six years from a current level of just 3,100 b/d from four wells. The consortium has removed landmines from the area and completed seismological surveys, as well as setting three well-drilling towers at the field. The companies plan to increase production to 70,000 b/d in 2011 (MEED 9:9:10).

The field was included in Iraq’s second oil and gas licensing round in December 2009, which aims to increase crude oil production to 4.5 million b/d within five years and to 6 million b/d within 10 years. Current production is 2.7 million b/d. The group will be paid a remuneration fee of $1.40 per barrel.

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