Canada’s Shamaran Petroleum has entered a production sharing contract with the Kurdistan Regional Government (KRG) for the Taza Block in northern Iraq.

The company originally signed an option agreement in July 2009 for the 511 square kilometre block, but has now exercised its option, according to a 28 July company release.

Shamaran holds a 20 per cent working interest in the contract, along with the operator, Papua New Guinea’s Oil Search, which holds a 60 per cent working interest. The two firms carry all costs, but the KRG holds the remaining 20 per cent stake (MEED 7:9:09).

The Taza Block lies between the Pulkhana Block to the southwest and the Kormor block operated by Dana Gas to the northeast.

The partners acquired 2D seismic data in 2010, identifying a structure lying on a trend with the estimated 1 billion barrel Jambur field to the northwest, as well as the Sarqala oil discovery to the southeast, which has reported test rates of more than 9,000 barrels a day.

Along with the Taza Block, Shamaran has three other projects in the Kurdish region: the Pulkhana appraisal block, the Arbat oil discovery and the Atrush exploration block.