Outlook improves for two large southern Iraq oilfields: SOC

[SteveI]

Outlook improves for two large southern Iraq oilfields: SOC

November 5, 2010

Output at one of southern Iraq's largest oilfields is on the uptick after sharp declines, and it should bottom out at a second field next month before turning higher, the head of South Oil Co said in comments published on Friday.

At the same time, Dhiya Jaafar told iraqoilforum.com that total production in the south stood at 1.680 mbpd (million barrels per day), and was expected to reach about 1.82-1.85 mbpd by the end of the year.

Jaafar said production at the Rumaila field had dropped to 960,000 barrels per day (bpd) this summer but had picked up to 1.052 mbpd now.

He said it was expected to reach the initial production rate or IPR of 1.065 mbpd by the middle or end of November.

"Output will continue to increase and we will achieve the 10 percent increase of production above the IPR by the end of the year," he said.

"I expect by end December our output in Rumaila will be at least 1.150 mbpd and at end 2011 we should hit at least 1.3 mbpd."

Jaafar said SOC had signed a contract with BP to arrest the decline, but that there had been problems in adapting to working with a foreign firm.

"Rumaila is a big field and because it's the first one to be developed according to this new experience (with a foreign company), there were several obstacles we had to deal with which resulted in delays," Jaafar said.

He said BP and the China National Petroleum Corp had managed to reverse the decline over the past two months.

In contrast, production was still declining at another large field, West Qurna-1, where ExxonMobil had failed to reverse the trend, he said.

"Decline is continuing at West Qurna-1 naturally and we haven't been able to achieve any increase there. ExxonMobil has not been able to stop it with the current measures being taken, let alone reverse the trend and start increasing production," he said.

"We expect some positive development by the end of November. So far output dropped some 20,000 barrels per day below the IPR" of what industry sources estimate at 258,500 bpd.

"The delays are normal because it's a whole new experience," Jaafar said of working with a foreign company.

He said production at West Qurna-1 was expected to fall this month by another 10,000 bpd, but stop in December and rise to 10 percent above IPR within a year.

Last month, Iraq announced that its proven reserves stood at 143.1 billion barrels, a 24 percent increase on a previous estimate.

http://uk.news.yahoo.com/18/20101105/twl-outlook-improves-for-two-large-south-3cd7efd.html

[waterman13]

Sounds like good news, that's what we are looking for production increases.

WM13