Meed | BP and PetroChina prepare to award Iraq oil contract

BP and PetroChina prepare to award Iraq oil contract

10 April 2023

Basra Energy Company (BECL), a joint venture of UK-based BP and Beijing’s PetroChina, is preparing to award a general construction services contract for a project at Iraq’s Rumaila field.

The client is in negotiations with contractors over the details of the contract, according to industry sources.

The contract will upgrade existing upstream facilities at the oil field, and BECL is in talks with contractors from China and Turkey about the project.

BECL operates the Rumaila field through an existing technical service contract, which will expire at the end of 2034.

Since 1 June 2022, BECL has owned and managed the interests of BP and PetroChina in the Rumaila field.

Along with PetroChina and BP, the Iraqi state-owned Basra Oil Company (BOC) and the state-owned oil marketing company Somo are also shareholders of BECL.

The Rumaila oil field is in southern Iraq, 32 kilometres from the Kuwaiti border. It is Iraq’s largest oil field and is estimated to contain 17 billion barrels, about 12 per cent of the country’s oil reserves.

In December last year, the Iraqi Minister of Oil Hayan Abdul-Ghani confirmed that Iraq was trying to raise the production capacity of the Rumaila oil field by 300,000 barrels a day (b/d) to 1.7 million b/d.

As well as trying to increase oil production, Iraq’s Ministry of Oil is pushing forward with projects to gather associated gas produced from the Rumaila oil field, in cooperation with Basra Oil Company (BOC), South Gas Company (SGC) and Basrah Gas Company (BGC).

This will reduce gas flaring and increase the volume of natural gas processed and delivered to consumers.

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Wil Crisp