China Petroleum Pipeline Bureau (CPPB), a subsidiary of state-owned China National Petroleum Corporation (CNPC) has emerged as the frontrunner for two pipeline construction contracts worth about $300m in the southeast of Iraq after submitting the lowest priced bids.

Commercial proposals were submitted in early April, following technical submissions in February for the two pipeline projects.

The larger deal covers a 24-inch, 165-kilometre-long oil export pipeline from the Badra field in the southeast of Iraq to the Gharraf field. The second scheme covers infield oil, gas and water pipelines connecting wellheads, central processing and storage facilities by the end of 2015.

Russia’s Gazprom, the developer of the Badra oil field, is expected to make a decision before Ramadan on a contractor for the two pipelines. CPBB submitted the lowest price of approximately $190m for the export pipeline and $130m for the infield pipelines, according to a source close to the project. Italy’s Saipem was the second lowest. CPPB also proposed around $130m for the infield pipelines.

Bidders include:

• CPPB
• Saipem (Italy)
• Punj Lloyd (India)
• Dodsal (Dubai-based)
• Petrofac (UK)

France’s Technip has carried out the front-end engineering and design (Feed).

The Badra oil 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 barrels a day (b/d) within five years and to 6 million b/d within 10 years. Current production is approximately 2.8 million b/d.