Russia’s largest private oil company,LUKoil, said it is considering joining a joint venture to develop Iraq’s Nassiriya oil field in Iraq. LUKoil saidits board of directors was considering a joint venture with its counterparts at Russia’s state-owned exploration and production company Zarubezhneft to develop the oil field and help build an associated refinery.
From the Soviet times, Russia has been active in terms of involvement in the development of Iraq’s oil and gas reserves and it’s not a surprising that LUKoil has been quite active in Iraq as well.
“The expansion of LUKoil’s presence in Iraq will make sense,” AlexanderKornilov, a senior oil and gas analyst at Moscow’s Alfa Bank, toldNew Europe on 28 April. He noted, however, that from the shareholders’ perspective many things depend on terms of LUKoil’s participation. “We need to see whether that kind of development will be beneficial for the holders of LUKoil stock,” he said.
LUKoil is already involved in developments of Iraq’s West-Qurna 2 project. The Russian oil major said it recently reached a deal with the Iraqi Ministry of Industry to estimate the prospects for building a plant that would utilise gas associated with the oil field in southern Iraq. First oil was produced from West Qurna-2 in March. It reached a daily production reach of 120,000 barrels and has an estimated 34 billion barrels worth of recoverable reserves.
Kornilov reminded that Russia has always been quite active in Iraq and some other companies from Russia, in particular state-owned Rosneft has paid attention to some projects in Iraq.
Rosneft is reportedly considering a proposal from Exxon Mobil about becoming involved with the US energy majorin Iraq’s Kurdistan region.
Iraq has some of the world’s largest deposits of oil and gas and aims to boost energy production dramatically. Iraqi oil production from January to February, the last full month for which data are available from the Organization of Petroleum Exporting Countries (OPEC), increased 13% to 3.3 million barrels per day.