Petronas, the Malaysian state oil firm, has agreed to train 60 Iraqi oil engineers to help it develop the Gharaf oilfield.

The engineers will attend an intensive 6-month course in Malaysia and will then be sent back home to supervise the company’s operations, according to a report from Azzaman.

Petronas and Japan Petroleum Exploration Co (Japex) won the 20-year service contract to develop the 900-million barrel field. They have agreed to invest about $7 billion.

Petronas has a 60 percent stake in the venture, and Japex the rest.

Petronas and Japex will get $1.49 per barrel from Gharaf the development of which could churn out 230,000 barrels a day.

Iraq’s oil ministry announced on Friday that it would begin drilling for oil in the Gharraf oil fields by the end of the year.

(Source: Azzaman)

Reuters reports that the state-run Japan Oil, Gas and Metals National Corp (JOGMEC) said on Thursday it expects to provide about 16.3 billion yen ($198 million) of capital in 2011-2012 to Iraq’s Gharaf [Gharraf, Garraf] oilfield development project.

In return, JOGMEC said it would take a stake of less than 50 percent in Japan Petroleum Exploration’s (Japex) wholly owned subsidiary that is taking part in the project.

Malaysia’s state oil firm Petronas holds 45 percent of the oilfield development and production service project, Japex 30 percent, and Iraq 25 percent.

The consortium, which expects to invest up to $8 billion, expects oil production to start in 2012 at 50,000 barrels per day, rising to 230,000 bpd of plateau output from 2016.

In a statement, JOGMEC said: “It is expected that this project will contribute to strengthen and deepen a relationship with Iraq, as well as reinforce Japan’s energy security”.

(Sources: Reuters, JOGMEC)

Weatherford International has won a deal to build early production facilities at Iraq’s untapped Garraf oil field in southern Iraq, a former Iraqi oil ministry official said Wednesday, according to a report from Dow Jones.

Adnan Galay, who retired as chairman of the field’s joint management committee a few weeks ago, declined to give the value of the deal. However, contracting sources attending an Iraqi energy meeting in Istanbul said the contract is worth about $200 million.

Galay said that Lakeshore TolTest Corp will be a subcontractor to the project.

Weatherford was awarded the contract by the Malaysian company Petronas (45% stake) and its partners, Japan Petroleum Exploration (Japex) (30% stake), and Iraq’s state South Oil Company (25% stake).

Petronas, which has been considering bid proposals since the late summer of 2010, chose Weatherford over three rival bidders–Petrofac with JGC, and Saipem with Punj Lloyd.

The giant oil services company earlier this year won a deal worth $52 million to drill 11 new wells in Garraf, located halfway between the southern cities of Karbala and Nasiriya in Thi Qar [Dhi Qar] governorate. The field was discovered in the 1980s by the then Iraqi oil ministry, and has oil reserves of 1 billion barrels.

Output from the field is expected to hit 50,000 barrels a day next year, 60,000 barrels a day in 2013 and 100,000 barrels a day in 2014, Galay said.

Garraf has an eventual output target of 230,000 barrels a day, although the Petronas-Japex partnership may increase production beyond that level, officials said.

“Three wells have been drilled to date, and testing oil proves that gravity ranges from 24 to 36 degrees API in the two reservoirs of the field,” Galay said.

The Garraf early production work involves construction of a degasing facility with two trains of 50,000 barrels a day each, as well as storage tanks and infrastructure.

Weatherford earlier carried out the front-end engineering and design study at Garraf.

(Source: Dow Jones)

As part of its third quarter earnings results, Schlumberger has issued the following statements on its operations in Iraq:

• In Iraq, Wireline MSCT* mechanical sidewall coring technology has been deployed on two exploration wells. Core recovery in the tight and fractured carbonate reservoirs was 100% for each job and the cores will yield the petrophysical properties needed to evaluate these difficult reservoirs accurately. The information will be integrated with other log data for better reservoir characterization and to subsequently design optimal testing and completion programs.
• Also in Iraq, Techlog* petrophysical analysis software has been introduced on a project on the Siba field to provide an independent evaluation on three wells as a first step to evaluate future exploration wells and build the reservoir simulation model. The workscope includes recommendations for further data acquisition and technical work, which will help reduce uncertainties in future field development plans. The project was conducted jointly by Data & Consulting Services and Schlumberger Information Solutions.
• Elsewhere in Iraq, Schlumberger has been awarded a new contract by PETRONAS Carigali. The PETRONAS contract covers well testing services for the Garraf field appraisal and development program that includes two exploration and nine development wells.
• In Iraq, Gazprom Neft Badra, B.V. has awarded Schlumberger a 3-year contract for well construction services covering 11 wells and requiring 3 drilling rigs. The contract includes technologies from IPM, Bits & Advanced Technologies, Drilling & Measurements, Geoservices, M-I SWACO, Wireline and Well Services, as well as the supply of third-party drilling rigs, coring, casing and well heads.
• In Iraq, as part of IPM operations on the Rumaila field for the Rumaila Operating Organization, Drilling & Measurements PowerPak* ERT high-performance steerable motors have been deployed in combination with Smith ONYX* PDC drill bits and M-I SWACO drilling fluids to drill the geologically challenging 8 1/2-in hole section. This was drilled in one run, with no service quality incidents, at a rate of penetration that reached section total depth three days ahead of plan.

(Source: Schlumberger)

Malaysia’s Synergistic Generation Sdn Bhd (SGSB), which is 60 percent owned by UMW Holdings Bhd, has entered into a $30 million contract  with Petronas Carigali Iraq Holding BV (PCIHBV).

The contract is for the procurement of materials and equipment and installation and commissioning of all equipment and facilities by SGSB for the setting up of the Garraf Power Plant Phase I at the Garraf oilfield.

(Source: Bernama)

Bloomberg reports that Malaysia’s Petronas and the Japan Petroleum Exploration Co. (JAPEX) will start producing crude from the Gharraf oil field in southern Iraq by September.

Sattar Mahdi, head of field development, said the field will initially produce about 35,000 barrels a day by the end of the third quarter, gradually increasing capacity to 230,000 barrels a day within five years.

The companies recently drilled four wells in Gharraf and will drill another 13 in the next six months.

(Source: Bloomberg)

By John Lee.

The Iraqi Deputy Prime Minister for Energy Affairs, Hussein al-Shahristani, has reportedly urged the consortium developing the Gharraf oilfield in Maysan province to speed up progress on the project.

He also offered to help “eliminate the obstacles facing the work of the company”,  which is a venture between the Japanese JAPEX and Malaysia’s Petronas.

A delegation led by Osamu Watanabe, chairman of JAPEX, visited the Deputy PM on Sunday to discuss the development of the Gharraf and East Baghdad oil fields.

The company will open a training center for unemployed people this week.

The statement added that “both sides also suggested the establishment of a power plant of 150 megawatts which will use gas produced from the field,” explaining that “The middle of next year, 2013, will see production of more than 100,000 barrels per day from the Gharraf field.”

(Source: AIN)

By John Lee.

Japan Petroleum Exploration (Japex) and its partners have delayed the start of production in the Gharraf [Garraf] oil field by six months, according to Bloomberg.

Production was scheduled for the end of 2012, but will now be postponed until the end of June; a company official blamed the delay on problems with Iraq’s infrastructure.

Japex President, Osamu Watanabe (pictured), said he expects initial production of 60,000 barrels a day, rising to 230,000 bpd in 2017.

Malaysia’s state oil firm Petronas holds 45 percent of the oilfield development and production service project, Japex 30 percent, and Iraq’s North Oil Company (NOC) 25 percent.

The company previously had a plan to start operations by September of last year, and were urged last summer by Iraqi Deputy Prime Minister for Energy Affairs, Hussein al-Shahristani to speed up progress on the project.

(Source: Bloomberg)

By John Lee.

Iraq’s Ministry of Oil has announced that the long-awaited start of production at the Gharraf [Garraf] oilfield is now scheduled for the end of August.

Initial output is expected to be 35,000 barrels per day (bpd).

The company previously had a plan to start operations by September of last year, and were urged last summer by Iraqi Deputy Prime Minister for Energy Affairs, Hussein al-Shahristani to speed up progress on the project.

Malaysia’s state oil firm Petronas holds 45 percent of the oilfield development and production service project, Japan Petroleum Exploration (Japex) 30 percent, and Iraq’s North Oil Company (NOC) 25 percent.

(Source: Ministry of Oil)

By John Lee.

The Gharraf [Garraf] oil field in Thi Qar [Dhi Qar] province, 85km north of the City of Nasiriyah, produced its first commercial output of oil on 31st August.

Iraq’s Ministry of Oil said the flow rate was 35,000 barrels a day, and peak production of 230,000 bpd was expected in 2017.

Japan Petroleum Exploration (JAPEX), in partnership with Malaysian national oil company PETRONAS and the Iraqi state-owned North Oil Company (NOC), secured the winning bid for the field in December 2009 under Iraq’s Second Petroleum Licensing Round.

In July 2010, JOGMEC granted equity financing to Japex Garraf Ltd., an affiliate of JAPEX, for the development of the field.

(Sources: Ministry of Oil, JOGMEC)

Korea’s STX Heavy Industries has announced another major contract win in Iraq.

The $99.5-million deal will see the company build a new gas treatment facility at the Gharraf [Garraf] oilfield.

Malaysia’s state oil firm Petronas holds 45 percent of the Gharraf project, Japan Petroleum Exploration (Japex) 30 percent, and Iraq’s North Oil Company (NOC) 25 percent.

STX said that the project is expected to be completed by the end of November 2015.

Earlier this month, the company announced a $449m order to build a 550km pipeline in the Akkas gas field.

(Source: ConstructionWeekOnline)

Gazprom Neft has completed laying, testing and connecting a 165 km oil pipeline from the Badra field, which the Company operates in Iraq, to the Gharraf oilfield (Nasiriyah district, Iraq).

With infrastructure already in place at Gharraf, completion of the pipeline from Badra means that the field is now connected to the main Iraqi pipeline system.

The new infrastructure for transporting raw materials from Badra has the capacity to transport 204,000 barrels per day, around 10 million tonnes per year, and can now supply oil to the export terminal at the city of Basra.

The Badra-Gharraf pipeline has two underwater transits, including one crossing the river Tigris, and passes over dozens of canals and irrigation systems. For increased operating security, a system to detect leaks and shut off damaged sections and a power supply system running on solar cells will work along the entire length of the pipleline.

Automated systems ensure constant monitoring of the oil transit and real-time management of the pipeline from the Badra field. Gazprom Neft has successfully completed hydrodynamic testing of all sections of the pipeline and the system has been checked for robustness and integrity.

Gazprom Neft produced its first oil at Badra in December 2013 as part of operating tests on well BD4. Work is currently continuing at the site to develop the infrastructure necessary to launch production, which is scheduled for the first half of 2014.

The construction of a central gathering station (CGS) with a capacity of 170,000 barrels per day is under way. The first CGS line will be coming into operation imminently, with a capacity of 60,000 barrels per day. Work has also started on a complex gas treatment plant (UKPG) with the capacity to handle some 1.5 billion cubic metres per year.

(Source: Gazprom Neft)

By John Lee.

Oil Minister Dr. Adel Abdul Mahdi [Adel Abdel Mehdi] (pictured) has announced the establishment of three new oil companies.

The Dhi Qar Oil Company has been set up to put the extraction and production of oil from fields in Dhi Qar under their direct supervision of the people of the province. This follows the successful developement of the fields at Nasiriyah and Gharraf.

The Ministry is also setting up a new oilfield services company and a new crude oil pipelines company.

(Source: Ministry of Oil)

By John Lee.

Iraq has this week established the Dhi Qar Oil Company (DQOC), which will take over responsibility for the Nassiriya and Garraf oil fields.

The South Oil Company (SOC) has been renamed the Basra Oil Company (BOC), following the transfer of the Dhi Qar assets to the new company.

(Source: Reuters)

Turkish oil and gas services company Ergil has been awarded a design, engineering, fabrication, and testing contract by China Petroleum Engineering & Construction Corporation ( CPECC), for Petronas‘ Garraf oil field.

The company says it has completed designing, manufacturing and supplying of 12 units 320-bar high-pressure pig receivers and launchers, 28 units pig signallers, 12 units manual pig jib crane and 8 units pig trolley.

The field is owned by Petronas (45%), Japex (30%) and the North Oil Company (25%).

(Source: Ergil)

Baker Hughes, a GE company has been awarded a contract by the South Gas Company of Iraq (SGC) for fast-track solutions to help the recovery of flare gas for Nassiriya and Al Gharraf  [Garraf] oilfields. The importance of the project was highlighted by the attendance of several high-level officials, including HE Jabbar Al-Luaib, the Minister of Oil of Iraq, at the agreement-signing ceremony.

As per the agreement, BHGE will develop solutions for flare gas recovery at Nassiriya and Al Gharraf oilfields using advanced modular gas processing (NGL) technology developed in the United States and Italy. The project will utilize the modular skid-mounted Gas Processing technology to build 200 million standard cubic feet per day (MMSCFD) NGL plant and is expected to be completed by 2021.

The project will support the development of a fully integrated natural gas liquid (NGL) plant at Nasiriya that will recover 200 MMSCFD of dry gas, liquefied petroleum gas (LPG) and condensate.

The modular solution will support power plants with dry gas for efficient power generation, thus helping meet the growing demand for electricity using clean fuel. It will also contribute to curtailing the amount of gas flared in the fields of Nassiriya and Gharraf that otherwise goes to waste.

The advanced technology used to develop the plant will help produce more than 1,000 tons of LPG per day and recover more than 900 cubic meters per day of condensates, which will help to meet the domestic demand for cooking gas.

The surplus LPG and condensate will be exported, generating high revenue to the Iraqi government.  Contributing to the social and economic development of Nassiriya, the project is aligned with the vision of the Ministry of Oil and the government.

H.E. Jabbar Ali Al-Allaibi, Iraq’s Minister of Oil said, that this project is important achievement for the Ministry and marks the entry of a new phase for the sector, highlighted by time optimal utilization of flare gas, which is a major milestone in the government’s extensive efforts to drive a better future for Iraq.

H.E. also highlighted the prominence of this project for the province of Dhi Qar specifically and for Iraq in general adding that BHGE will provide it latest and advanced technologies and solutions to optimize the use of flare gas at the Nassiriya and Al Gharaf oilfields recovering 200 MMSCFD of dry gas daily.

Rami Qasem, President, MENAT & India, BHGE, said:

“As a local trusted partner to Iraq, BHGE is bringing advanced technologies and solutions that can help meet the Ministry’s goals for the industry. This contract is a testament to our continued commitment to supporting the Ministry of Oil’s strategic goals by deploying advanced flare gas solutions to build the country’s oil and gas infrastructure. The project will create more than 500 direct and indirect jobs for Iraqis, build local capabilities and strengthen the local supply chain.”

BHGE is the first and only company in the world to provide a fullstream offering covering products, services and digital solutions for the oil and gas sector, from upstream, to midstream to downstream.

BHGE has been a committed partner to Iraq for more than 50 years, with three offices in Iraq – Baghdad, Erbil and the Basra –  and more than 350 employees in country, BHGE continues to deliver its latest technology and expertise to its local customers.

(Source: Baker Hughes)

Malaysia’s Petronas and Japan Petroleum Exploration (Japex) are planning to award a deal shortly to drill several wells at Iraq’s untapped Garraf [Gharraf] oil field in southern Iraq, a company executive said.

The  consortium is planning to drill two appraisal wells at Garraf, in Dhi Qar province, starting in November, he said.

“We have issued a tender but we haven’t awarded it yet,” the executive told Dow Jones Newswires.

The Petronas-Japex alliance was awarded the deal to develop Garraf, with estimated proven oil reserves of one billion barrels, during the country’s second licensing auction in December last year.

The field was discovered in 1984, but has not yet been developed. It is situated 5 km northwest of Al-Refaei city, 9 km southeast of Qal’at Suker city, and 85 km north of Nasiriyah.

The executive said the consortium is in discussions with tribesmen who had allegedly refused to cede their ancestral lands peacefully without a cash payment from the two companies.

“We are in discussions with them,” the executive said.

The alleged extortion drew condemnation from the Iraqi oil ministry, and the tribal sheiks have since denied any threat of violence, saying that they merely approached the two companies with a request.

Local leaders appear to have helped mitigate the tribal pressures, an Iraqi oil industry source said.

The companies pledged to boost crude oil production from Garraf to 230,000 barrels a day in 2016 and accepted $1.49 for each barrel produced.

Petronas holds 45% stake in the venture, Japex owns 30%, while the remaining 25% sake is owned by Iraq’s state oil company.

(Sources: Upstreamonline.com, Dow Jones, Iraqi Ministry ofOil)

Related articles:

• Malaysian-Japanese Consortium Embarks on Developing Gharraf Oilfield
• Local Iraqis Oppose New Oil Deals

Iraq's South Oil Company, working with the IOCs, has set quarterly
production targets for the country's southern oilfields for 2011,
according to documents obtained by Reuters.

Production is targeted reach an average of nearly 2.3m bpd by Q4 2011.

 Oilfields            Q1          Q2          Q3          Q4

 Rumaila           1,175,000   1,201,000   1,226,000   1,250,000

 West Qurna 1        260,000     270,000     285,000     300,000

 Majnoon              70,000      80,000      90,000     100,000

 Zubair              280,000     310,000     340,000     360,000

 Gharaf                  -           -           -        35,000

 Nahr Bin Umar        45,000      50,000      60,000      70,000

 Ratawi               10,000      14,000      18,000      25,000

 Luhais               60,000      70,000      80,000      85,000

 Tuba                 10,000      15,000      20,000      30,000

 Nassiriya            15,000      20,000      30,000      30,000

TOTAL              1,925,000   2,030,000   2,149,000   2,285,000

(Source: Reuters)

quarterly 2011 production targets for
Iraq's southern oilfields

By John Lee.

Japex is reportedly planning to increase production at the Gharaf oil field from around 90,000 barrels of oil per day (bpd) currently to 230,000 bpd by the end of 2020.

S&P Global Platts quotes Japex director Michiro Yamashita as saying that the company has allocated capital expenditure of $460 million for the project in fiscal 2019-20 (April-March).

(Source: S&P Global Platts)

Malaysia’s Petronas and Japan Petroleum Exploration (Japex) are planning to award a deal shortly to drill several wells at Iraq’s untapped Garraf [Gharraf] oil field in southern Iraq, a company executive said.

The  consortium is planning to drill two appraisal wells at Garraf, in Dhi Qar province, starting in November, he said.

“We have issued a tender but we haven’t awarded it yet,” the executive told Dow Jones Newswires.

The Petronas-Japex alliance was awarded the deal to develop Garraf, with estimated proven oil reserves of one billion barrels, during the country’s second licensing auction in December last year.

The field was discovered in 1984, but has not yet been developed. It is situated 5 km northwest of Al-Refaei city, 9 km southeast of Qal’at Suker city, and 85 km north of Nasiriyah.

The executive said the consortium is in discussions with tribesmen who had allegedly refused to cede their ancestral lands peacefully without a cash payment from the two companies.

“We are in discussions with them,” the executive said.

The alleged extortion drew condemnation from the Iraqi oil ministry, and the tribal sheiks have since denied any threat of violence, saying that they merely approached the two companies with a request.

Local leaders appear to have helped mitigate the tribal pressures, an Iraqi oil industry source said.

The companies pledged to boost crude oil production from Garraf to 230,000 barrels a day in 2016 and accepted $1.49 for each barrel produced.

Petronas holds 45% stake in the venture, Japex owns 30%, while the remaining 25% sake is owned by Iraq’s state oil company.

(Sources: Upstreamonline.com, Dow Jones, Iraqi Ministry ofOil)

Related articles:

• Malaysian-Japanese Consortium Embarks on Developing Gharraf Oilfield
• Local Iraqis Oppose New Oil Deals