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Iraq approves latest round of oil, gas exploration

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 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 and one to United Energy Group, also based in China.

Source: Reuters

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