Lukoil has started drilling production wells and building the central processing facility at supergiant West Qurna-2 oil field in Iraq, where it targets production of 500,000 b/d by 2013-14 (OGJ Online, Mar. 22, 2012).
In the current project it plans to drill 23 directional wells with a sliding-rig system from five well pads. The company expects total investment in the West Qurna-2 project to reach $25 billion.
West Qurna-2, covering 340 sq km 65 km northwest of Basra, holds oil reserves estimated at 14 billion bbl.
Lukoil and Statoil won a contract for the project in January 2012 with a bid of a $1.15/bbl remuneration fee at a production level of 1.8 million b/d.
They will be able to recover expenses and receive remuneration once production reaches 150,000 b/d.
Interests are Lukoil 56.25%, state-owned North Oil Co. 25%, and Statoil 18.75%.