Oil companies comes to agreement with Iraq for resuming investment

(IraqiNews.com) Baghdad – Iraq has reached an agreement with the major oil companies like British Petroleum, Shell and Lukoil to restart stalled investment in oil fields that the companies are developing and allowing projects that were stopped this year.

Sharing details Iraqi officials said, “Iraq agreed with BP, Shell and Lukoil to restart stalled investment in oil fields, which the firms are developing and allowing projects that were halted this year. The agreement will also allow crude oil production to increase in 2017.”

“As a result of the investment, Iraq’s crude oil output should increase by 250,000 – 350,000 barrels per day next year. The country now produces about 4.6 million barrel per day, most of it from the southern region,” the Iraqi officials added.

All the three firms have agreed to spend in H2 2016 roughly half the budgets they proposed for 2015, BP agreed to spend $1.8 billion this year at the Rumaila field it operates. It had initially agreed to spend $3.5 billion last year, which it later revised down to $2.5 billion.

Shell agreed to spend $742 million after proposing $1.5 billion last year. Lukoil would spend $1.08 billion, compared to $2.1 billion it had proposed last year.

The Iraqi oil ministry in February earlier this year said that the budget for foreign oil company development costs had been revised down to just over $9 billion in 2016, while the companies estimated their cost at $23 billion.

Among OPEC members, Iraq’s supply rose the most last year and output reached a record of 4.775 million barrels per day in January 2016.