BASRA, Iraq, Jan 7 (Reuters) – Iraq’s oil ministry and the newly established Dhi Qar Oil Co plan to revive talks with international oil companies to boost production at the Nassiriya field and build a refinery to process crude from the region, a company executive said on Thursday.
The ministry in 2014 postponed a bidding round with a group of companies that had expressed interest in the integrated project, whose initial cost was estimated at $ 10 billion, after Islamic State launched attacks across northern and western Iraq.
Southern provinces, including Dhi Qar, which produce the bulk of Iraq’s oil exports, were not affected by the hardline militants’ advance.
Iraq established Dhi Qar Oil Co on Tuesday to supervise four fields located in the namesake province, including Nassiriya and the Petronas-operated Garraf field.
State-run South Oil Co, which the oil ministry this week renamed Basra Oil Co, supervised the Dhi Qar fields previously and will transfer its assets in the province to the new company.
The international companies that expressed initial interest in developing the Nassiriya field and refinery include Lukoil and PetroChina, Dhi Qar’s head of field operations, Kareem Yasir, told Reuters. He declined to say whether the revived talks would involve the same companies.
The initial oil ministry project provided for the Nassiriya refinery to have a capacity of 300,000 barrels per day (bpd).
“The oil ministry may decide not to hold a bidding round and opt instead for direct talks” separately with each company, Yasir said.
Nassiriya has more than 4 billion barrels in reserves and the potential to produce 200,000 bpd, compared with a current daily output of 70,000 barrels produced by South Oil, Yasir said.
(Reporting Aref Mohammed; Writing by Maher Chmaytelli; Editing by Dale Hudson)
