The Iraq Oil Ministry has said that the consortium developing the Gharraf oil fields will begin drilling for oil by the end of 2010.
Gharraf is not currently producing any oil, but is being developed by Malaysia’s Petronas and the Japan Petroleum Exploration Company (Japex). An initial production of 50,000 barrels-a-day is expected from eight wells.
In May Petronas awarded the US’ Weatherford International the contract to provide engineering design for the development of the oilfield, which is located in the Thi Qar governorate, 375 kilometres south of Baghdad.
The consortium paid a signature bonus of $100m and will receive a remuneration fee of $1.49 for each additional barrel produced over 35,000 barrels a day (b/d). The companies plan to increase production to 50,000 b/d by 2012 and 230,000 b/d by 2023.
The Iraq National Oil Company (INOC) also holds a minority stake in the field.