The Iraqi oil ministry is planning to announce the first round of tenders to develop its vast oil fields, which are among the world’s largest, at the end of June or the beginning of July, an Iraqi oil official said Monday.
"Iraq is going to announce the first round of tenders to develop super giant oil fields in southern and northern Iraq either at the end of June or the beginning of July," the official told Dow Jones Newswires by telephone from Baghdad.
The official named seven oil fields and two gas fields that would be included in the first tender announcement. They are North Rumaila, South Rumaila, Zubair, West Qurna, and Buzurgan in southern Iraq and Kirkuk and Bai Hassan in northern Iraq. The two gas fields are Akkaz in western part of the country and Mansouriya in the east.
Over the last few months, the ministry has been working to prepare contract models for these fields, the official said. The ministry has signaled that more restrictive service contracts may be used to develop these fields, rather than controversial production-sharing contracts.
The official said the ministry would hold a news conference to announce these new tenders.
Iraq is currently in the final stages of striking what are called Technical Services Contracts, or TSCs, with oil majors to help boost crude oil production in the country’s largest producing fields.
Iraqi oil sources said these TSCs could be signed as early as June. Each would last two years and could be extended for another year.
Oil Minister Hussein al-Shahristani has threatened to cancel these TSCs if they aren’t signed in June. The TSCs are designed to boost Iraq’s crude oil production from producing oil fields.
Iraq wants to boost production by 600,000 barrels a day in six producing oil fields in northern and southern Iraq. They are Kirkuk in the north, West Qurna 1, Zubair, Missan, Rumaila and Luhais in the south.
Iraq is currently producing around 2.5 million barrels a day, a tiny fraction of its 115 billion barrels of proven crude reserves, the world’s third largest.
So far BP PLC and Exxon Mobil Corp. have submitted TSC proposals to the Iraqi Oil Ministry, and at least three more oil majors are also expected to submit their plans to Iraq to develop to other oil fields.