A Kuwait Energy-led consortium signed the final service contract with the Iraqi Ministry of Oil for the exploration, development and production of oil in block 9, Basra. The deal was awarded to the consortium during Iraq’s fourth round of bidding in May 2012.
The Kuwait Energy-led consortium for block 9, an 866 square kilometer area in Iraq’s Basra province, includes Dragon Oil, an independent international oil and gas exploration and production company.
Kuwait Energy will be the operator of the block with a 70 per cent working interest, while Dragon Oil will hold the remaining 30 per cent interest.
Under the contract, “potential hydrocarbons prospects” will be assessed during the five-year exploration phase of the deal, which is eligible for a renewal for two years, twice.
In the case of a discovery, the consortium will be automatically eligible for 20-year development and production phases, extendable by an additional five years, Kuwait Energy said in a statement.
Kuwait Energy CEO, Sara Akbar said: “On behalf of Kuwait Energy and our partner, we look forward to continue participating in the development of Iraq’s energy resources, and supporting the country’s endeavors towards the development of its energy sector.”
This is the third block awarded to Kuwait Energy in Iraq. The company was awarded two 20-year development contracts for the Siba and Mansuriya gas fields in October 2010.
Kuwait Energy holds a 60 per cent working interest in the Siba gas field and a 30 per cent working interest in the TPAO-operated Mansuriya gas field.