Gazprom Neft launches production drilling at the Badra oil field in Iraq

05 June 2014

Gazprom Neft has begun its production drilling programme at the Badra field in Iraq where Gazprom Neft is the field operator. Drilling work began with a well over 4,800 meters long in May 2014 under a contract with Chinese company ZPEC which provided for the drilling of six wells in total. Two development wells have now been successfully tested and switched to production status, making it possible to launch commercial oil production at Badra. The development of a third well is still under way.

On 31 May, Gazprom Neft began production at the Badra oilfield in Iraq. The central gathering station (CGS) is currently undergoing complex testing of its crude oil processing system. Testing will be completed in three months once enough oil has been accumulated for commercial production to begin. The Badra field will then be ready to reach planned production levels of 15 thousand barrels per day. New infrastructure for the field’s commercial development has been put in place. The CGS’s first line has been constructed with a capacity of 60 thousand barrels per day and in March 2014 the Badra field was connected to the 165-kilometre-long main Iraqi oil pipeline system.

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The Badra oil field is located in Wasit Province in Eastern Iraq. According to preliminary estimates, geologic reserves at the Badra field amount to 3 billion barrels of oil.

First oil was produced at the field in late 2013. Production is expected to reach 170,000 barrels of oil per day (around 8.5 million tonnes a year) by 2017 and remain at this level for seven years. Drilling of a total of 17 production wells and 5 injection wells is planned at the field.

The contract with the Iraqi government for development of the oil field was signed in January 2010 upon completion of a bid process in December 2009. The winning bid was submitted by a consortium of companies consisting of Gazprom Neft, KOGAS (Korea), PETRONAS (Malaysia), and TPAO (Turkey). Gazprom Neft is the project operator.

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

The Badra oil field development project is scheduled to last 20 years with a possible 5-year extension. Under the terms of the contract, investors will be reimbursed for costs incurred and paid a fee of $5.5 per barrel of oil equivalent produced.