Iraq’s oil minister has called on international oil companies and investors to develop the country’s unexploited oilfields.
“We have no constraint as to the nationality of the interested party or the type of contract for the development of these fields as long as they are fair and represent a value for the Iraqi people,” Ibrahim Baher Al Olom claims.
Olom says that a number of explored and appraised oilfields ready for exploitation with much bigger production potentials than presently producing fields are yet to be developed.
These fields have the potential to produce an extra amount of oil of not less than 3mn barrels a day (m/bd) with the prospect for even more if the right technology and production conditions are employed.
The country’s total production capacity is now close to 2.4m/bd, but because of limitations on oil exports due to attacks on the Northern pipeline and some production problems faced by the Southern field, the actual production is running at only about 2m/bd, he says.
He adds that crude oil exports have witnessed some gains during the third quarter of this year with close to 1.6m/bd and expectations are to raise oil production especially from the south to bring the level of oil export close to 1.7m/bd by the end of the year and 2m/bd by next year.
Continued terrorist attacks on oil installations and production problems have frustrated the fulfilment of the targeted oil production levels, he says.
“To complicate the matter even further, locally available funds to boost the oil industry and increasing production are becoming hard to find in the face of the increasing needs for the limited oil export revenues by the government. Besides, foreign investment is still hesitant and needs more time to understand the working environment and the investment conditions in Iraq”, says Olom.
He points out that these challenges are compounded by even bigger political changes with oil revenues being almost the only sources of income for financing the government expenditure and investments.
“But it is important to note that any significant increase in oil flow can only come through improved security situation in the country. The government is planning to implement important security improvement measures to protect the pipelines and oil facilities, especially those which are frequently subjected to sabotage and attacks,” he adds.
Likewise, he says, for significant expansion of oil production this year and years to come can only be achieved through cooperation with international oil companies.
“We believe that the security situation has witnessed some improvement especially in the south of the country, where most of the Iraqi new oil prospects are located and further improvement will be seen after the elections”, he said.
He added that investment opportunities would be opened to develop a number of major oil fields located mostly in the south of the country, which would require large funds and wider scope of technology which can only come from outside the country.