Iraq’s Oil Ministry has signed a deal with a group led by Russia’s Gazprom for the development of the Badra oil field, southeast of Baghdad City.
Gazprom won the rights to develop the field as part of the second oil licensing round held on 11 and 12 December, although the project still requires cabinet approval.
A source at the ministry said official signing of the contract took place on 26 December.
Gazprom will operate the Badra field with a 40 per cent stake after the consortium it leads won the deal to produce 170,000 barrels a day (b/d) at the currently inactive reservoir.
Gazprom with Turkey’s TPAO, South Korea’s Kogas, and Petronas were the only consortium to bid for the deal, and offered $6 for every barrel of oil produced above a 15,000 b/d target. However, this was cut to $5.50 after talks with the oil ministry.
The contracts are part of a programme to increase Iraq’s oil production capacity to 12 million b/d by 2016 from current levels of about 2.5 million b/d.