JSC Gazprom Neft has received the first delivery of Kirkuk-grade oil from Iraq as compensation for its investment in Badra field development in Wasit province.
Iraq’s State Oil Marketing Co. (SOMO) delivered 500,000 bbl to the Turkish port of Ceyhan. Gazprom Neft says the buyer is a large Asian company.
Under the terms of the contract, signed by the consortium in January 2010, investors will be reimbursed quarterly for costs incurred and paid a fee of $5.50/bbl of oil produced.
Gazprom Neft operates the Badra development project. At the end of last November, within 90 days of commissioning, oil was delivered into the main pipeline at a rate of at least 15,000 b/d, fulfilling the basic condition of the development contract.
Commercial oil shipment from Badra began in August 2014 (OGJ Online, Sept. 2, 2014). Three wells are operating on Badra and three more are being drilled (OGJ Online, Jan. 2, 2015). Production totals 15-17,000 b/d.
Preliminary estimates have Badra’s geological reserves at 3 billion bbl of oil. The development project is scheduled to last 20 years with a possible 5-year extension.
The contract consortium consists of Gazprom Neft 30%, Korea Gas Corp. 22.5%, Petronas 15%, and Turkish Petroleum Corp. 7.5%. Interest held by the Iraqi government, represented in the project by Iraq Oil Exploration Co., is 25%.