Gazprom Neft begins oil production in Iraqi field

oilfield iraq-indigoprime flickrThe Badra oilfield is located in Wasit Province in Eastern Iraq. (Image source: Indigo Prime/Flickr)Gazprom Neft has announced that it has began production at the Badra oilfield in Iraq

The central gathering station (CGS) is currently undergoing complex testing of its crude oil processing system.

The Russia-listed company said that testing will be completed in three months once enough oil has been accumulated for commercial production to begin.

The oilfield is expected to reach a planned production level of 15,000 bpd.

The Badra oilfield is located in Wasit Province in eastern Iraq.

Gazprom Neft said that the CGS’s first line has been constructed with a capacity of 60,000 bpd and in March 2014 the Badra field was connected to the 165-km-long main Iraqi oil pipeline system.

Production in the oilfield will reach a peak of 170,000 bpd in 2017 and remain at that rate for seven years.

Vadim Yakovlev, first deputy CEO of Gazprom Neft, said, “Development at the Badra field is one of Gazprom Neft’s first international assets in oil production. We launched this project from scratch and over a short period of time have completed all of the complex work necessary for the industrial development of the field.

"The experience of being an operator on this project has further strengthened Gazprom Neft’s expertise, which will contribute to work on other new projects, for example in the Near East and other regions where the company is exploring opportunities for further development.”

According to preliminary estimates, geologic reserves at the Badra oilfield amount to three billion barrels of oil. The contract with the Iraqi government to develop the oilfield was signed in January 2010.

Gazprom Neft is the operator of the oilfield with 30 per cent stake, while KOGAS has 22.5 per cent interest, PETRONAS has 15 per cent holding and TPAO has a 7.5 per cent interest.

The share of the Iraqi government, represented in the project by the Iraqi Oil Exploration Company (OEC), is 25 per cent.

Under the contract, investors will be reimbursed for costs incurred and paid a fee of US$5.5 per barrel of oil equivalent produced.

The Badra development project has a projected lifetime of 20 years with a possible extension of five years, the company added.

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