Iraq approves fifth round of gas exploration contracts in east (updated)

United Energy

23/01/2020 15:35

(Adds background)
    BAGHDAD, Jan 23 (Reuters) - Iraq has approved contracts in a
fifth bidding round for gas exploration contracts the east of
the country, the government said in a statement on Thursday.
    The exploration deals in Diyala province are to develop
fields that are expected to produce more than 750 million cubic
feet of natural gas within 36 months.
    Iraq, OPEC's second-largest producer after Saudi Arabia,
depends on oil sales for over 90 percent of its public budget
and has been under pressure from the United States to reduce its
reliance on gas imports from Iran.
    The country flares much of its own gas, extracted alongside
crude oil at its fields, because it lacks the facilities to
process it into fuel and instead uses Iranian power imports to
generate electricity.
    Iraq auctioned off a total of 11 blocks near the borders
with Iran and Kuwait and in offshore Gulf waters in 2018 but
failed to attract many major firms, with only Italy's Eni
 ENI.MI  submitting an offer.
    Five of the exploration blocks failed to attract any bids.
Of those remaining, three went to Iraqi-owned, United Arab
Emirates-based Crescent Petroleum, two to China's Geo-Jade
 600759.SS  and one to United Energy Group  0467.HK , also based
in China.

 (Reporting by Ahmed Rasheed; Writing by Nadine Awadalla;
Editing by John Davison and David Evans)
 ((Nadine.Awadalla@thomsonreuters.com;))