Chinese Giant Wins $1bn Iraqi Project
Iraq awarded a $1.07bn contract to China Petroleum Engineering & Construction (CPECC), a subsidiary of CNPC, to capture and process 3bn m3/yr gas from the Halfaya oil field, the oil ministry announced May 9. The field, in the south of the country, is operated by another CNPC subsidiary, PetroChina.
The contract signing came two days after Iraq announced a $53bn deal with PetroChina and American giant ExxonMobil, aimed to boost oil production, as well as capturing 1bn m3/yr from the Artawi and Nahr Bin Umar oil fields, near Halfaya.
Iraq’s oil minister Thamer Ghadhban said that Iraq also plans to capture another 3bn m³/yr from the West Qurna 2 and Majnoon oilfields, but the negotiations with companies on those projects are ongoing.
CPECC also signed a contract with Iraq's Basra Gas Company in February 2019 for a natural gas liquids plant in the Artawi area, west of Basra in southern regions, which is scheduled to complete by the end of 2020. This contract is also aimed at capturing flaring.
According to the International Energy Agency, Iraq flares 16bn m3/yr. Iraq plans to cut this and burn the gas in power stations instead, reducing the need for imports of electricity and gas from Iran.
US has given a waiver to allow Iraq to continue importing at the rate of 11bn m3/yr from Iran until late June and it is not clear whether the exemption will be extended.
Iraq also imported close to 5 TWh electricity from Iran worth $630mn during the Iranian fiscal year that ended March 20, according to an energy ministry report, seen by NGW. Iraq paid Iran $2.4bn for the gas. Iran also increased goods export to Iraq by 37% year-on-year to $8.961bn during last fiscal year, custom statistics indicate.