Iraq to Offer 12 Oil/Gas Blocks in January

Source: Reuters 4/25/2011, Location: Middle East

Iraq formally invited international energy firms to compete for 12 new exploration blocks in a fourth oil and gas bidding round but delayed the auction until January of next year.

Officials had previously said the bidding round would be held in November.

Iraq expects to add 29 trillion cubic feet of gas and 10 billion barrels of oil to Iraqi reserves from the auction. Iraqi Oil Minister Abdul-Kareem Luaibi made the official announcement of the auction in Baghdad but did not immediately disclose the date of the event.

The oil ministry will offer data packages to interested companies in August, and the auction will take place in January 2012, Luaibi said.

The contracts for the exploration blocks will be service agreements like those given in previous oil auctions, he said. One of the 12 exploration blocks on offer is in restive northern Nineveh province, another in the southern province of Basra, three in the western desert of Anbar province and seven in other areas of central and southern Iraq.

OPEC member Iraq sits on the world's fourth-largest oil reserves and flares around 700 million cubic feet of gas every day at its southern oilfields.

It needs to harness energy to generate electricity and end chronic power blackouts that still plague the country almost eight years after the U.S.-led invasion.

Iraq auctioned three major natural gas fields to foreign firms last October.

Iraq's fourth auction is part of a three-stage plan set by the Oil Ministry to boost proven reserves of oil and gas. "We have set a promising, three-stage plan to start first with offering exploration blocks, second to launch a massive exploration operation through Iraq's own national capacity, and third, drilling 12 exploration wells (in other areas) across Iraq," Luaibi said.

The plan aims to maintain and increase national reserves to offset the expected depletion of fields developed by international oil firms and offered in the last three bidding rounds, Luaibi added.

"This promising plan will considerably boost Iraqi oil and gas reserves," Luaibi said.

Iraq has signed a series of deals with international oil companies in a bid to boost its production capacity to 12 million bpd in seven years, which could make it a close rival to global leader Saudi Arabia. However, most analysts say 6-7 million bpd is a more realistic target.


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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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