The National - News

IRAQI ‘TO RAMP UP OIL OUTPUT’ POST REBUILDING OIL & GAS

Energy consultanc­y Wood Mackenzie says it expects a million barrels per day from 2017 to 2025

- JENNIFER GNANA

Iraq, the second-largest oil producer within Opec, could raise production capacity by a million barrels per day in 10 years, buoyed by healthy momentum in upstream activity, according to energy consultanc­y Wood Mackenzie.

The forecast by the company based in Edinburgh is conservati­ve compared with Iraq’s ambitions to raise production capacity. The federal Iraqi oil ministry has set aside a target of raising production capacity to 6.5 million bpd by 2022.

The country produced 4.65m bpd in September, according to the latest figures from Opec.

“Looking at everything on a project-by-project basis, looking at FIDs [final investment decisions], we’re very positive on growth for Iraq … by a million barrels per day from 2017 to 2025. It’s over 10 years, but it’s relative,” said Ann-Louise Hittle, vice president of macro oils at Wood Mackenzie.

Outgoing Iraqi Oil Minister Jabbar Al Luaibi said earlier this year the country was confident of breaching its desired 5m bpd target this year.

Iraq accounts for 8.8 per cent of proven reserves of oil worldwide, much of which is cheap and easily extractibl­e.

However, its upstream sector has been crippled by decades of war, which forced a brain drain of talented engineers, and also led to a shutdown of refineries.

With a new Iraqi government in place, and the defeat of ISIS, which had taken over key oilfields and refineries, the government is now moving towards rehabilita­ting the country’s energy and power sector, including reducing the flaring of gas from its southern-oil fields.

The Iraqi government has begun to invite interest in its oilfield developmen­t projects, notably tendering a few blocks earlier this year.

The country also signed a two-year contract in April with China’s Anton Oilfield Services and London’s Petrofac to operate its giant Majnoon field, which Iraq took over after Anglo-Dutch major Shell exited from the project.

The ministry also said it aimed to boost its light crude exports to a million bpd next year, even as it presses for waivers from

US sanctions against its neighbour and ally Iran, with whom Baghdad had entered into an agreement to truck oil from its fields at Kirkuk.

Iraq’s plans for waivers and boost in production capacity come amid an anticipate­d decline in supply from Iran, which is struggling to get its oil to market prior to the imposition of sanctions by the US administra­tion on November 4.

Wood Mackenzie estimates that 1.1 million bpd of Iranian oil is likely to be lost to the markets.

“We’re looking at fall from 3.8m to 2.7m bpd from the spring to November,” said Ms Hittle. “China is going to be in the range of 500,000 bpd. We’re looking at continuati­on of exports to Turkey, exports to India on a reduced basis of 150,000 bpd.

“Crude will go to Syria, maybe 50,000 bpd and condensate exports will continue at a cargo-by-cargo basis at about 10,000 bpd,” she said

WoodMacken­zie, however, anticipate­s condensate exports to hold steady due to the startup of a couple of condensate splitters in Iran.

“One has started up already and it’s going to ramp up once we go into the next year and help absorb the condensate that’s spilling out of South Pars,” Ms Hittle said.

South Pars is the world’s largest gas field and is shared with Qatar, which refers to the concession as North Dome.

 ??  ?? A production facility in Zubair oilfield in Basra
A production facility in Zubair oilfield in Basra

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