Lukoil Announces Tender For Iraq's West Qurna-2

Russian oil company OAO Lukoil Holdings (LKOH.RS) has issued four tenders for the multibillion project to develop Iraq 's supergiant West Qurna Phase 2 oil field in southern Iraq , the company said Monday.

The tenders are for construction of an oil export pipeline; a storage plant; a power distribution station and an associated gas processing plant; and an oil gathering system, processing facility and a water supply system.

Bidders have until Dec. 4 to file bids for the project and will be offered engineering, procurement and construction contracts, or EPC, Lukoil said.

Operator Lukoil and Norway 's Statoil ASA (STO) were awarded a 20-year service contract for West Qurna Phase 2 in Iraq 's second licensing round last December. The companies promised to get the southern field pumping at a rate of 1.8 million barrels a day for payment of $1.15 a barrel.

The development project is one of 11 that Iraq awarded in two licensing rounds last year. If all the companies deliver to the letter of their contracts, nearly 10 million barrels a day of capacity will be added to Iraq 's existing 2.5 million barrels a day by 2017.

Last week, Lukoil awarded a mine clearing contract for the West Qurna-2 project to G4S Risk Management, a division of the London-based G4S Ordnance Management.

A person familiar with the tender process told Dow Jones Newswires in July that Lukoil had started issuing tenders for 3D seismic survey and for drilling of between 50 and 60 oil wells.

The person said Lukoil expects to award these contracts to "big and well-known firms such as Halliburton Co. (HAL), Weatherford International Ltd. (WFT), Schlumberger Ltd. (SLB) among others." These oil services companies are already involved in projects in southern Iraq .