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Iraq plans to have its newly restarted Qayara oil field in the north produce 60,000 bpd by the end of this year, targeting to gradually ramp up the current 30,000 bpd production, S&P Global Platts quoted the Iraqi oil ministry as saying.
The Qayara oil field was shut-in for years until last year, due to the war with Islamic State.
In December last year, Iraq declared the war with ISIS over, and has been seeking foreign investments in major projects that would help revive its economy.
Before the war with the Islamic militants ISIS started, the oil pumped at the Qayara field was only directed to the local nearby refinery, partly because of its proximity and partly because of a lack of infrastructure for exports.
But after the oil field was restarted, part of its production was diverted for exports after a road with a loading platform for trucks was built, sources familiar with the operations told S&P Global Platts. Oil from Qayara has been transported via trucks to Kurdistan, Turkey, and Iran, according to Platts sources. Iraq’s state oil marketing company SOMO has been marketing the oil.
If Iraq manages to further boost production at the Qayara oil field, it could raise its oil production and exports and get more revenues at a time when oil prices are rising and supply from neighboring Iran is declining with the U.S. sanctions on Tehran’s oil sector snapping back in early November.
As per OPEC’s secondary sources, crude oil production in Iraq—OPEC’s second-largest producer—soared by 90,000 bpd from July to stand at 4.649 million bpd in August.
Related: Saudi Aramco Set To Boost Oil Capacity By 550,000 Bpd In Q4
Iraq’s oil production will only grow marginally over the next 10 years despite its potential capacity, which stands at as much as 7 million bpd, an analyst from IHS Markit has recently forecast. According to Christopher Elsner, Iraq will only be able to boost production to 5 million bpd over the next decade, and by 2036 it would only grow to 6 million bpd, Arab News reports.
The reason for the country’s inability to boost production considerably is the political and economic situation. Iraq is currently dealing with protests in the south prompted by problems ranging from a lack of access to clean drinking water and electricity to high jobless rates.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.