Iraq, Orion sign deal to process gas from giant oilfield (updated)
22/01/2018 10:37
(Adds year for flaring to end, details, comments about Kuwait
deal)
By Ahmed Rasheed
BAGHDAD, Jan 22 (Reuters) - Iraq agreed a deal with U.S.
energy company Orion on Monday to process natural gas extracted
at its giant Nahr Bin Omar oilfield.
The memorandum of understanding, signed in Baghdad by
representatives of the oil ministry and the U.S. company, will
allow Orion Gas Processors to build facilities to capture the
gas from the field located in southern Iraq and to transform it
into usable fuels.
Nahr Bin Omar, operated by state-run Basra Oil Co., is
producing more than 40,000 barrels per day of oil (bpd) and 25
million cubic feet a day of natural gas.
Iraq continues to flare some of the gas extracted alongside
crude oil at its fields because it lacks the facilities to
process it into fuel for local consumption or exports.
Orion will capture and process 100 million to 150 million
cubic feet/day (mcf) of gas, Oil Minister Jabar al-Luaibi said
at the ceremony.
The gas captured will be used to feed power stations and to
produce up to 10 million litres of gasoline, equivalent to 32
percent of Iraq's total imports of the fuel, he said.
Gas flaring across Iraq should end by 2021, he added.
The minister said he plans to visit Kuwait in February to
finalize a deal on exporting Iraqi gas, adding that the selling
price of the fuel is yet to be agreed by the two countries.
The two countries are discussing a pipeline project to
bring 50 mcf of Iraqi gas per day to Kuwait for ten years,
increasing to 200 mcf per day over the period. urn:newsml:reuters.com:*:nL8N1NW06Q
The exports, to come from the Rumaila field, would be used
as feedstock for a petrochemical plant and pay off Baghdad's
final $4.6 billion in war reparations owed for its 1990 invasion
of Kuwait.
Iraq hired Japan's Toyo Engineering 6330.T to help build
the project.
(Reporting by Ahmed Rasheed and writing by Maher Chmaytelli;
editing by Louise Heavens)
((maher.chmaytelli@thomsonreuters.com; +9647901917030;))
Keywords: IRAQ GAS/ENERGY