Chinese companies win more bids to explore for Iraq oil and gas

Chinese companies ZhenHua and CNOOC Iraq have won bids to explore Iraqi oil and gas fields, Iraq's oil minister said as the Middle East country's hydrocarbon exploration licensing round continued into its second day on Sunday.

The ongoing Iraqi hydrocarbon exploration licensing round has seen Chinese companies emerge as the biggest winners, according to Iraq's oil minister [1]. The latest energy bidding rounds offer a total of 29 oil and gas projects, with eight of them awarded on the first day [1]. Out of these eight projects, five were secured by Chinese firms.

One such Chinese company, Zhongman Petroleum and Natural Gas Group (ZPEC), was awarded the rights to develop the Northern Extension of East Baghdad oil field [1]. The company will receive a 6.67% share of the profits from the field, which is located in central Iraq and shared between Baghdad and Salahuddin provinces. ZPEC's bid was less than the one submitted by Iraq KAR Company but higher for the Middle Euphrates fields [1].

China's UEG was the sole bidder for Fao block in the southern province of Basra [1]. The oil ministry accepted UEG's bid of 25.16% of the net profit, making it the third Chinese company to secure a significant deal in the ongoing bidding round.

Zhenhua, another Chinese firm, was awarded the deal to develop the Qurnain block, located in southern Iraq and shared between Najaf and Anbar provinces [1]. Initially, Zhenhua requested a 25% share of the net profit but later accepted the oil ministry's rate of 17.3%.

Geo-Jade, a Chinese company, secured the rights to develop Zurbatiya block in Wasit province in central Iraq [1]. The company initially asked for a 12.65% share of the net profit but later accepted the Oil Ministry's offer of 7.65%.

The Iraqi oil minister stated that the bidding rounds will last three days and that companies have until Monday to submit their bids for the Okashat block if there is any interest [1]. The oil ministry aims to boost Iraq's oil and gas reserves, with plans to announce an increase in its proven oil reserves to more than 160 billion barrels from the current 145.02 billion barrels [1].

The Iraqi government is committed to providing a safe and stable working environment and removing complicated routines and bureaucracy to attract international oil companies [1]. This commitment is expected to help Iraq stop burning natural gas within the next three to five years [1].

References:
[1] The National News. (2024, May 11). Iraq opens gas and oil reserves for development as it seeks to boost revenues. Retrieved from https://www.thenationalnews.com/business/energy/2024/05/11/iraq-opens-gas-and-oil-reserves-for-development-as-it-seeks-to-boost-revenues/