Thursday, September 20, 2007
LUKoil to have advatage in West Qurna-2 tender
Oil
(Bloomberg, AP) - LUKoil will have an advantage in a new tender for the West Qurna-2 field in Iraq, Iraqi Foreign Minister Hoshyar Zebari said, Interfax reported Wednesday. LUKoil's investments and work at the field will be taken into consideration should the oil producer bid, Zebari said, Interfax reported. The minister invited LUKoil chief executive Vagit Alekperov to Iraq, Interfax said.
LUKoil has been lobbying Iraq to recognize the West Qurna-2 contract that it signed with former dictator Saddam Hussein's government. LUKoil wants to develop the field with shareholder ConocoPhillips. LUKoil's 1997 contract to drill at West Qurna-2, which has an estimated reserve capacity of 4 billion barrels, has been hamstrung under the new authorities in Iraq. The Iraqi parliament is expected to pass a new law that will review previous oil contracts and open the way to a wave of tenders to tap Iraq's enormous oil wealth.
LUKoil has been lobbying Iraq to recognize the West Qurna-2 contract that it signed with former dictator Saddam Hussein's government. LUKoil wants to develop the field with shareholder ConocoPhillips. LUKoil's 1997 contract to drill at West Qurna-2, which has an estimated reserve capacity of 4 billion barrels, has been hamstrung under the new authorities in Iraq. The Iraqi parliament is expected to pass a new law that will review previous oil contracts and open the way to a wave of tenders to tap Iraq's enormous oil wealth.
Labels: ConocoPhillips, Hoshyar Zibari, LUKoil, oil, tender, Vagit Alekperov, West Qurna-2
Thursday, August 09, 2007
Shahristani in Moscow for talks with oil companies
Oil
(The Moscow Times) - Iraq's oil minister arrived in Moscow late Wednesday for talks with Industry and Energy Minister Viktor Khristenko and senior oil executives and said he would offer new terms for Russian companies seeking to work in the war-torn country. Officials from a consortium of three Russian companies -- LUKoil, Zarubezhneft and Mashinoimport -- are expected to meet on Thursday with Iraqi Oil Minister Hussain al-Shahristani in a bid to regain access to the country's oil fields.
In particular, the companies will be hoping to revive a $4 billion deal to develop the 600,000 barrel-per-day West Qurna field, which was scrapped by dictator Saddam Hussein shortly before the U.S.-led invasion in 2003. "Iraq will cooperate with those companies that will propose the best conditions for Iraq, regardless of what countries these companies come from," Shahristani said on his arrival in Moscow, RIA-Novosti reported. Shahristani said no country would get preferential treatment in the competition for Iraqi oil assets. "LUKoil will be competing with other firms on equal terms in accordance with the new oil laws." If LUKoil proposes projects that are competitive enough, it will get the contracts, Shahristani said. LUKoil will likely be hoping to make use of its 20 percent U.S. shareholder, ConocoPhillips, to ease its way back into the country. LUKoil has offered Conoco a 17.5 percent stake in the West Qurna project.
In May, the Iraqi government said it was not prepared to accept a Russian offer to forgive $10 billion in Hussein-era debt in exchange for giving Russian companies access to another major oil field, in Rumaila, Reuters reported. The visit comes as the Iraqi government readies a new law governing foreign investment in the country's oil industry, which has struggled to recover from underinvestment under Hussein and disruption by terrorist attacks under the U.S.-led occupation.
Semakov said LUKoil would create some 2,000 jobs for Iraqis in one field at West Qurna alone. The company has invested "tens of millions of dollars" in the project but would plow in much more in the future, he said.As the invasion of Iraq began, the Russian firms had to abandon their projects and evacuate staff.
Labels: ConocoPhillips, Hussain al-Shahristani, LUKoil, Mashinoimport, Rumaila field, Russia, Viktor Khristenko, West Qurna, Zarubezhneft
Wednesday, April 25, 2007
Russian govt. backs LUKoil's bid to develop Iraqi oil field
Oil, Business
(Financial Times) - The Russian government is throwing its full support behind Lukoil's ambition to become the first big international energy group to develop a major Iraqi oil field following the 2003 US invasion.
Vagit Alekperov, Lukoil's chief executive, said in an interview on Tuesday: "The Russian government supports us, the foreign ministry supports us, the president of the federation supports us. They support the idea of putting those Iraqi fields [into production] as soon as possible. In all these areas we have the support of the Russian government."
He added that Lukoil would be able to develop the West Qurna field two to three times more quickly than any other company. "We are ready to move really fast," he said. "The situation in South Iraq is pretty stable and we have no problem starting operations right after the passage of the hydrocarbon law and once we have the necessary approvals," he said. Iraq's parliament aims to pass the law by the end of next month.
West Qurna is believed to hold as many as 11bn-15bn barrels of recoverable oil reserves and has a potential to produce as many as 1m barrels a day, making it one of the world's biggest fields. International energy companies such as ExxonMobil, Royal Dutch Shell and BP have been waiting for the security situation in Iraq to improve before developing fields, and analysts believe the situation in the Shia-dominated region close to the southern port of Basra where West Qurna is located is far from predictable.
But at least one US company would benefit if Iraq's oil ministry assigned the development of West Qurna to Lukoil. In 2004 ConocoPhillips, the US's third largest energy group, formed a strategic partnership with Lukoil in which the US company gradually expanded its stake to just shy of 20 per cent. At the time of the announcement, the companies noted the eventually development of West Qurna as one of their motives for the deal.
Lukoil has spent more than a decade angling for West Qurna. In spite of United Nations sanctions, the company signed a deal with Saddam Hussein, Iraq's deposed president, in 1997 to develop the field. But in 2002, shortly before the US invasion, Baghdad rescinded the deal, saying it was angered by Lukoil's attempts to get assurances from the opposition that it would keep the contract in case Mr Hussein's regime fell. In the past two years Lukoil has spent $20m to train 1000-2000 Iraqi oil field engineers in Russian fields, put another 100 through Russian universities and provide equipment for Iraq's oil industry.
Vagit Alekperov, Lukoil's chief executive, said in an interview on Tuesday: "The Russian government supports us, the foreign ministry supports us, the president of the federation supports us. They support the idea of putting those Iraqi fields [into production] as soon as possible. In all these areas we have the support of the Russian government."
He added that Lukoil would be able to develop the West Qurna field two to three times more quickly than any other company. "We are ready to move really fast," he said. "The situation in South Iraq is pretty stable and we have no problem starting operations right after the passage of the hydrocarbon law and once we have the necessary approvals," he said. Iraq's parliament aims to pass the law by the end of next month.
West Qurna is believed to hold as many as 11bn-15bn barrels of recoverable oil reserves and has a potential to produce as many as 1m barrels a day, making it one of the world's biggest fields. International energy companies such as ExxonMobil, Royal Dutch Shell and BP have been waiting for the security situation in Iraq to improve before developing fields, and analysts believe the situation in the Shia-dominated region close to the southern port of Basra where West Qurna is located is far from predictable.
But at least one US company would benefit if Iraq's oil ministry assigned the development of West Qurna to Lukoil. In 2004 ConocoPhillips, the US's third largest energy group, formed a strategic partnership with Lukoil in which the US company gradually expanded its stake to just shy of 20 per cent. At the time of the announcement, the companies noted the eventually development of West Qurna as one of their motives for the deal.
Lukoil has spent more than a decade angling for West Qurna. In spite of United Nations sanctions, the company signed a deal with Saddam Hussein, Iraq's deposed president, in 1997 to develop the field. But in 2002, shortly before the US invasion, Baghdad rescinded the deal, saying it was angered by Lukoil's attempts to get assurances from the opposition that it would keep the contract in case Mr Hussein's regime fell. In the past two years Lukoil has spent $20m to train 1000-2000 Iraqi oil field engineers in Russian fields, put another 100 through Russian universities and provide equipment for Iraq's oil industry.
Labels: ConocoPhillips, Iraq Oil, LUKoil, Vagit Alekperov, West Qurna
Saturday, March 17, 2007
ConocoPhillips planning to develop oil field with LUKoil
Oil, Commerce
(BI-ME) - ConocoPhillips said this week it is talking with Iraq's Oil Ministry about possible projects, while continuing to work on plans to develop an Iraqi oil field in partnership with Russia's OAO Lukoil. Chairman and Chief Executive James Mulva said the US-based company is continuing to look at development plans for Iraq's West Qurna field with Lukoil, in which ConocoPhillips holds close to a 20% stake. Lukoil's West Qurna deal initially dates to the Saddam Hussein era, and Mulva said he hopes it is re-affirmed.
West Qurna is one of Iraq's largest oil fields, loacated North of Rumaila field, West of Basra. West Qurna is believed to hold 11 to 15 billion barrels of recoverable reserve and have production potential of 0.8 to 1.0 million barrel per day, equivalent to upwards of US$47 million per day or US$17.3 billion per year.
"We've also done a lot of study and training, working directly with employees and members of the ministry within Iraq to see what ConocoPhillips can do ourselves," he said in an interview after making a morning presentation to analysts in New York.
The company would require that several issues be resolved before it operates in the country, Mulva said. At the top of the list is a new petroleum law defining what role international oil companies would have in developing Iraq's resources. "We are waiting for the new petroleum law to be passed," Mulva said. "There's good progress in that regard, and hopefully it will be completed in time." When asked what he meant by "in time," Mulva said weeks to several months.
Passage of the law, Mulva said, will give the number three US oil company a clearer picture of what opportunities it can pursue within Iraq. Another requirement for ConocoPhillips, Mulva said, is improved security in Iraq. "For security reasons, we haven't had our employees in Iraq," Mulva said. The company would need positive assessments from the government and security firms for that to change, he said.
West Qurna is one of Iraq's largest oil fields, loacated North of Rumaila field, West of Basra. West Qurna is believed to hold 11 to 15 billion barrels of recoverable reserve and have production potential of 0.8 to 1.0 million barrel per day, equivalent to upwards of US$47 million per day or US$17.3 billion per year.
"We've also done a lot of study and training, working directly with employees and members of the ministry within Iraq to see what ConocoPhillips can do ourselves," he said in an interview after making a morning presentation to analysts in New York.
The company would require that several issues be resolved before it operates in the country, Mulva said. At the top of the list is a new petroleum law defining what role international oil companies would have in developing Iraq's resources. "We are waiting for the new petroleum law to be passed," Mulva said. "There's good progress in that regard, and hopefully it will be completed in time." When asked what he meant by "in time," Mulva said weeks to several months.
Passage of the law, Mulva said, will give the number three US oil company a clearer picture of what opportunities it can pursue within Iraq. Another requirement for ConocoPhillips, Mulva said, is improved security in Iraq. "For security reasons, we haven't had our employees in Iraq," Mulva said. The company would need positive assessments from the government and security firms for that to change, he said.
Labels: ConocoPhillips, James Mulva, LUKoil, West Qurna
