Gazprom Neft selects contractor to lay pipeline in Iraq

10 April 2014

Gazprom Neft, operator of the Badra oilfield development project, has appointed a contractor to lay the pipeline connecting the field to the power station in Zubaidiah (Wasit Province). The tender was won by Pakistani company Techno Engineering Services (Pvt.) Ltd.

In line with the contract, Techno Engineering Services will produce the designs, supply the equipment and materials, and carry out construction of the pipeline. First gas transportation via the pipeline, which is almost 100 km in length and has a daily capacity of 4.4 million cubic metres (circa 1.6 billion cubic metres per year), is planned for 2015.

Under Gazprom Neft’s contract with the Iraqi government for the development of the Badra oil field, investors are to be compensated for costs related to infrastructure construction.

Gas supply from the Badra oil field will enhance the Zubaidiah power station’s daily power output and provide a <nobr>24-hour</nobr> power supply to the city of Kut, which currently has electricity supplied for only 16 hours per day. Some of the extracted gas will be used to provide electricity to the Badra oil fields themselves.

In March Gazprom Neft completed testing on a second well at Badra. The laying and testing of the oil pipeline to the Gharraf oilfield was completed in February, connecting the section to Iraq’s main pipeline system. The construction of the first phase of a central gathering station point with a capacity of 60,000 barrels per day is nearing completion. Work has also started on a gas treatment plant with the capacity to process 1.5 billion cubic metres per year.

REFERENCE

The Badra oil field is located in Wasit Province in Eastern Iraq. According to preliminary estimates, geological reserves at the Badra field amount to 3 billion barrels of oil. The contract with the Iraqi government to develop the oil field was signed in January 2010 following a tender process. The winning bid was submitted by a consortium of companies consisting of Gazprom Neft, KOGAS (Korea), PETRONAS (Malaysia), and TPAO (Turkey).

Gazprom Neft’s share in the project is 30%, while KOGAS has 22.5%, PETRONAS has 15%, and TPAO has 7.5%. The Iraqi government, represented in the project by the Iraqi Oil Exploration Company (OEC), has a 25% share. Gazprom Neft is the project operator.

The Badra oil field development project is intended to last 20 years, with a possible extension of a further five years. Commercial production at the field is expected to start in 2014. By 2017, the production volume is forecast to reach 170,000 barrels of oil per day (approximately 8.5 million tonnes per year) and remain at that level for seven years. A total of 17 production wells and five injection wells are planned at the field.