Russia’s state-run oil company, Lukoil PJSC, is looking to set up new oilfield projects in Iraq despite OPEC+ production cuts and a slump in oil demand, according to Bloomberg.

Lukoil, who has a substantial presence in Iraq, pumped on average 400,000 barrels of oil per day (bbl/d) which has now been reduced to 280,000 bbl/d at present. This is a measure to help Iraq comply with its OPEC production quota, despite Lukoil originally planning to boost production at the West Qurna 2 project in southern Iraq.

At present, the company is expected to keep output levels unchanged but Managing Director of Lukoil, Egor Zubarev, will “soon” submit proposals to the Iraqi authorities to develop a new area in Southern Iraq known as Block 10. 

Despite Lukoil’s desire to further invest in Iraq, there has been a slow down in oil projects rates as a result of increased pressure on the government’s budget and a shortage of cash. Furthermore, there is a severe need for extra investment with Zubarav maintaining that Iraq will need upgraded export facilities and pipelines.  

Iraq’s current output is limited to about 3.6 mmbbl/d under the OPEC+ deal.