Kirkuk
BP to develop new oil and gas fields in Iraq
BAGHDAD — Iraq signed an agreement with British energy giant British Petroleum on Thursday to develop four oil and gas fields in the northern governorate of Kirkuk.
A memorandum of understanding, described as “comprehensive”, was signed by Iraq’s Oil Minister Hayan Abdul Ghani and BP’s CEO Murray Auchincloss, Prime Minister Mohamed Shia Al-Sudani’s media office said.
“The memorandum includes the rehabilitation and development of the four oilfields under the North Oil Company in Kirkuk: the Kirkuk oilfield, Bai Hassan, Jambur and Khabbaz oil fields,” the statement said.
The memorandum also includes “potential” for agreements on other fields or exploratory blocks. “This initiative is part of the government’s efforts to optimally invest in promising energy opportunities, aiming to increase and enhance oil production and gas and solar energy investments,” it added.
BP is one of the biggest foreign players in Iraq’s oil sector, with a history of producing oil in the country dating back to the 1920s when it was still under British mandate.
BP marked its return to Iraq in 2009, becoming the first international oil company to re-enter the country after a 35-year hiatus. In partnership with PetroChina, BP was awarded a technical service contract to boost production at the Rumaila oil field in Basra, one of the world’s largest oil fields. Additionally, BP provided technical assistance to the state-owned North Oil Company for the redevelopment of the Kirkuk field.
Iraq, holding 145 billion barrels of proven oil reserves—one of the largest globally—can sustain production at the current rate for 96 years, according to the World Bank.
In 2013, BP and Iraq’s Ministry of Oil signed a letter of intent to develop the massive Kirkuk oilfield. This initiative stalled in 2014 when the Iraqi army collapsed under the Islamic State’s advance, allowing the Kurdistan Regional Government to assume control of the Kirkuk region.
By early 2018, following the federal government’s recapture of Kirkuk from Kurdish forces, BP and the Iraqi government signed a memorandum of understanding. This agreement aimed to escalate Kirkuk’s oil production to 750,000 barrels per day, with BP providing technological support.
On May 7, 2018, then-Oil Minister Jabbar Al-Luaibi announced an agreement between BP and Iraq’s North Oil Company to enhance the production capacity of six fields in the Kirkuk region to more than 1 million barrels per day.
Iraq continues to seek ways to expand its crude reserves beyond 160 billion barrels, as stated by Oil Minister Abdul Ghani in May. Despite possessing vast oil reserves, Iraq is also aiming to boost its natural gas production to lessen its dependency on Iranian imports, crucial for power generation but complicated by U.S. sanctions.
Prime Minister Al-Sudani has emphasized the need for Iraq to diversify its energy sources to alleviate chronic power shortages, particularly during the scorching summer months. As temperatures rise, the country faces frequent power outages, sparking widespread protests.
To mitigate reliance on Iranian gas, Iraq has begun importing electricity from Jordan and Turkey and is expected to connect to the Gulf countries’ electricity grid later this year. A significant development occurred in March when a 340-kilometer power line from Jordan to Al-Rutbah in Iraq’s southwest commenced operations.
AFP and 964media
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