Gazprom Neft and the Iraqi authorities have agreed in principle to update the development plan for the Badra field and to clarify the cost recovery mechanism. The parties only need to formalize this agreement for it to come into force, Vadim Yakovlev, deputy chairman of the company's management board, told reporters on the sidelines of the SPE Annual Technical Conference in Dubai.
"We are in an active dialogue with the Iraqi authorities and we believe that we have reached an understanding and in principle agreed on two points: the first point is the updating of the (Badra) field development plan, including the production profile in accordance with the geological characteristics of the field. The second thing is to specify the mechanism of cost compensation, and this specification is aimed at accelerating the terms of return. And it is important for us to fix these agreements, we are patiently working on it," he said.
According to Yakovlev, the fixing of the agreement between Gazprom Neft and Iraq could in the future allow increasing the volume of drilling and, consequently, the reserves of Badra, which would at least mitigate the current decline in production. "The conversation is quite active now, meetings are taking place regularly, and we are not losing hope that we will be able to bring this work to a conclusion. This, in turn, opens up opportunities to expand cooperation on additional activity, primarily in Badra," he said.
The deputy head of the company said that about 50% of reserves in the field may be additionally involved in active development. "That is, drilling at Badra can be continued. We are ready to do it, but in order to do this we first have to fix what we have already agreed on in principle," Yakovlev stressed.
Gazprom Neft in Iraq
Gazprom Neft is involved in four projects in Iraq, three of which are in the Kurdish region.
Gazprom Neft Middle East has stakes in the Halabja, Shakal and Garmian blocks. Gazprom Neft's stake in the Halabja and Shakal blocks is 80% (the remainder is held by the Kurdish regional government). Two prospecting wells were drilled in the Shakal block, and additional 3D seismic work has been completed and data processing and interpretation is being completed. At the Halabja block, the interpretation of 2D seismic data completed in 2015 is nearing completion.
Gazprom Neft's share in the Garmian block is 40%. Additional exploration of the discovered field and preparations for its full-scale development continue at the block.
Gazprom Neft's fourth project in Iraq is the development of the Badra field located in Wassit province in the east of the country. According to preliminary estimates, Badra's geological reserves are 3 billion barrels of oil. Gazprom Neft is the operator of the project and owns a 30% stake. Commercial production at Badra began in August 2014.
GSV "Russia - Islamic World"
Photo: Gazprom Neft
Based on materials from TASS