May 02, 2024 [Oil Price]- Iraq will see first natural gas production at its supergiant West Qurna field by the end of this year, Iraqi News reports, citing the Iraqi prime minister and federal energy authorities on Monday.
ExxonMobil withdrew from southern Iraq’s West Qurna 1 field in January, handing operations over to PetroChina, which now enjoys the largest stake in one of Iraq’s biggest fields.
The whole of West Qurna is home to an estimated 43 billion barrels of recoverable reserves, while West Qurna-1 was originally thought to have around 9 billion barrels, but was revised to 20 billion barrels in 2021. The target for first phase production is 700,000 barrels per day, up from 500,000 bpd previously anticipated.
In March, Reuters reported that Iraq had signed a five-year gas supply deal with Iran for 50 million cubic meters per day to feed Iraq’s power stations. Washington is attempting to encourage oil and gas deals with Iraq to avoid billions of dollars in revenue from gas and electricity exports for Tehran.
Just over a week ago, U.S. and Iraqi energy companies signed two deals designed to capture associated gas that Iraq is flaring due to lack of necessary infrastructure. The U.S. Department of State said in a statement that Iraq is currently flaring some 18 billion cubic meters per year of associated gas, second only to Russia.
Iraq has been strengthening ties with China, particularly in the energy industry, in recent years. In 2021, the two countries signed a framework agreement that opened the door for Beijing to acquire key Iraqi oil, gas and petrochemical assets.
Earlier this month, Iraq and China announced that the General Company for Ports in Iraq (GCPI), a consortium of Chinese companies, is close to completing the 300,000 barrels per day (bpd) oil refinery at Iraq’s key Faw Port. This is “in line with China’s eventual vision for Iraq as one part of a giant Mesopotamian client state including Iran as well,” Simon Watkins wrote for OIlprice.com at the time.
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