Iraq Delays Oil Production Capacity Boost on Lower Prices, OPEC Cuts
February 27 2018 - 7:50AM
Dow Jones News
By Benoit Faucon
BERLIN--Iraq has delayed a sharp boost to its production
capacity by more than a year due to lower oil prices and OPEC
output curbs, a top Iraqi oil official said Tuesday.
The setback underscores the challenges Iraq's recovering oil
industry faces as it seeks to attract investments from Western oil
giants following the defeat of Islamic State.
Abdulmahdy al-Ameedi, director general of oil contracts and
licensing at Iraq's oil ministry, said the country was set to
increase its production capacity to 5 million barrels a day next
year, more than a year later than initially planned.
Speaking to reporters on the sidelines of the Iraq Petroleum
conference in Berlin, he said international oil companies had
delayed investments due to lower oil prices and more recently
because Iraq had agreed to curb its output as part of a pact with
the Organization of the Petroleum Exporting Countries.
Oil majors have also complained of late payments and tough
contracts, an issue Mr. Ameedi said the government wants to resolve
by improving terms.
He later said the Iraqi government was ready to link repayments
on oil production to price movements, instead of the previous fixed
fee.
Royal Dutch Shell PLC (RDSA.LN) decided to pull out of the giant
Majnoon field last year. But the official said Iraq is in talks
with Chevron Corp. (CVX) and Total SA (FP.FR) to replace Shell in
the project, but that the government may still develop the field
without foreign operator. The official also said Iraq is in
discussions ExxonMobil (EXOM) on joining the Southern Integrated
Project, which will involve oil-field development and refining.
He said nine new blocks were currently offered near the Kuwaiti
and Iranian borders, while natural-gas fields also would be put for
tender soon.
Write to Benoit Faucon at benoit.faucon@wsj.com
(END) Dow Jones Newswires
February 27, 2018 07:35 ET (12:35 GMT)
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