Malaysian-led consortium blames infrastructure problems in Iraq
The date for first oil production from the Gharraf field in the south of Iraq has been pushed back by six months to June as its developers struggle with infrastructure challenges in the country.
Japan Petroleum Exploration Company (Japex), a partner at the field, had hoped to produce its first barrels of crude from the field by the end of 2012, but according to the company’s annual report, this will not now happen until June.
Exploration work began in June 2011 and a year later, six wells had been drilled, including one appraisal and five development wells. Another appraisal well and four new development wells were also planned for 2012.
Malaysia’s Petronas, the field’s operator, is aiming for an initial production level of 60,000 barrels a day (b/d), with an eventual target of 230,000 b/d by 2017. It is working with Japex and Iraq’s state-owned North Oil Company to develop the 1-billion-barrel Gharraf field, located in the Thi Qar governorate in southern Iraq. 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 b/d.
The first commercial production (FCP) facilities are currently being built by the US’ Weatherford International and consist of two crude production trains with a capacity of 50,000 b/d each.
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