KOGAS Signs Deal for Iraqi Gas

KOGAS of South Korea and Iraq's oil ministry have signed a deal to develop the Akkas gas field that holds an estimated 5.6 trillion cubic feet of gas.

KOGAS won the rights to develop the Akkas field near the Syrian border with Kazakhstan's KazMunaiGas during Iraq's third energy bidding round last October. But KazMunaiGas pulled out of the deal in May, forcing KOGAS to double its share in the project. It will be paid $5.50 per barrel of oil equivalent.

Iraq sits atop 126.7 trillion cubic feet of undeveloped gas reserves. According to Iraq officials,the gas will be used for domestic needs, mainly for power plants and the petrochemical industry while the surplus will be exported.

Akkas was one of three fields offered in an October licensing round. The other two were the 4.6  trillion-cubic foot Mansouriya field in eastern Iraq, which Turkey's TPAO, Kuwait Energy and KOGAS will develop jointly, and the 1.1 trillion-cubic foot Siba field in the south to be developed by Kuwait Energy and TPAO. Both of those deals were finalized in June. All three deals will run for 20 years.