Iraq’s Oil Ministry is completing the technical and legal process of establishing two new state oil companies to operate in the Dhi-Qar and Wasit provinces.

With production now at more than 100,000 barrels a day (b/d) in the provinces, the Oil Ministry plans to hand over greater control from South Oil Company and Midland Oil Company, which are currently responsible for them.

Two of the most important fields, which will be overseen by the Dhi-Qar Oil Company, are the Nasiriya and Gharraf fields. It also contains part of the 5,500 square kilometre Block 10 exploration area, which was awarded to a joint venture of Russia’s Lukoil and Japan’s Inpex Corporation in 2012.

Nasiriya is currently awaiting bids from international oil companies under the Nasiriya Integrated Project, a joint oil field and refinery development scheme. Bids are expected in June.

The Gharraf field is being operated by a consortium led by Malaysia’s Petronas. Production started at the end of August at around 35,000 b/d and is expected to rise to 100,000 b/d in 2014.  

The Wasit province contains the Al-Ahdab field, which is operated by China National Petroleum Corporation and the Badra field, operated by Russia’s Gazprom.

Baghdad has struggled to move ahead with legislation to reform the Iraq National Oil Company (INOC), which merged with the Oil Ministry in 1987. Since then, the Oil Ministry has been both the operator of Iraq’s oil sector and its regulator. Proposals to create the new oil company have been before parliament since 2007, but have not been passed.