Meed | Iraq oil project approaches halfway point

Iraq oil project approaches halfway point

19 July 2023

The project to develop new crude oil processing facilities at Iraq’s Rumaila oil field is nearly 50 per cent complete, according to sources.

“The project is proceeding well and nearly half of the work has been completed,” says one source.

In October last year, MEED reported that China Petroleum Engineering & Construction Corporation (CPECC) had signed a contract for the design, procurement, construction and testing of the new crude oil processing facilities.

The contract is valued at about $386m and construction is expected to take three years to complete.

The scope of work includes developing two new oil trains, each with a capacity of 120,000 barrels a day (b/d).

Joint venture

The Rumaila field is operated by a joint venture of UK energy producer BP and PetroChina, the listed arm of state-owned China National Petroleum Corporation (CNPC).

The name of the joint venture that operates the field is Basra Energy Company Limited (BECL).

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

China National Petroleum Corporation (CNPC) controls CPECC.

BP criticism

BP has recently faced criticism for using joint-venture companies to operate oil fields in Iraq.

The company omits non-operated joint ventures from its official climate impact reports, which critics say misleads investors.

In September last year, an investigation into BP’s Rumaila joint venture found that, based on its ownership of the operating company, its share of flaring for the Rumaila field was equivalent to 4.52 million tonnes of carbon dioxide in 2021.

This is double the UK oil industry’s total flaring emissions for that year, according to an analysis by Unearthed, Greenpeace’s investigative journalism unit.

Unearthed found that if Rumaila flaring was included in BP’s official reports, its flaring figure for 2021 would be double what was officially published.

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Wil Crisp