Upstream and downstream development planned in southern Iraq
Iraq plans to hold a new bid round on 19 December for the estimated $13bn Nasiriyah Integrated Project to jointly develop an oil field and a new grassroot refinery in the south of the country.
The Oil Ministry is currently holding the first of its workshops in Amman for the deal. The two-day workshop for prequalified companies was organised by the Oil Ministry’s Petroleum Contracts and Licensing Directorate (PCLD) to allow oil executives to discuss the project one-on-one with the ministry.
Abdul Mahdy al-Ameedi, the director general of the PCLD set out the timeline, contractual framework and terms for the project. This was followed by presentations summarising the technical aspects of the field and a review of the refinery’s front-end engineering and design (feed), which has been prepared by the US’ Foster Wheeler.
In March, the Oil Ministry announced it had prequalified seven firms to bid for the oil field and refinery development. Under the published timeline, the PCLD still hopes to sign contracts for the scheme by the end of the year.
The Oil Ministry will issue an initial tender protocol at the end of April, followed by data packages on 10 May. The first draft contract will be released on 1 July, with any comments from bidding firms due by 15 August. International oil companies will have another chance to make suggestions at a final workshop in September, before the revised draft contract is published in October. A final tender protocol and contract will be issued on 15 November, with the bid round set for 19 December.
The project covers the integrated development of the Nasiriyah oil field in the Thi-Qar province, along with the construction and operation of a new 300,000-barrel-a-day (b/d) refinery, the largest of a raft of new downstream facilities planned by the government.
Iraq’s downstream sector currently has a design capacity of 886,000 b/d, although operating capacity is estimated to be as low as 553,000 b/d. The shortfall is due to frequent stoppages in operation, inadequate crude feedstock supplies and the accumulation of fuel oil at the refineries lacking storage space. The new refineries aim to produce higher-quality products and reduce the country’s dependency on fuel imports.