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Lukoil has launched commercial production at massive West Qurna-2 oilfield in Iraq

31st March 2014

Russian company Lukoil held a ceremony on Saturday to usher in commercial production at its West Qurna-2 project – one of the largest with recoverable reserves estimated at around 14 billion barrels.

Lukiol West Qurna Iraq production
The West Qurna-2 Project could massively boost Lukoil's overseas revenue

Russian company Lukoil held a ceremony on Saturday to usher in commercial production at its West Qurna-2 project – one of the largest with recoverable reserves estimated at around 14 billion barrels.

The ceremony was attended by Hussain al-Shahristani, deputy prime minister of Iraq, Arkady Dvorkovich, deputy prime minister of the Russian Federation, Vagit Alekperov, president of OAO Lukoil, and various local government representatives.

Production at the site is expected to rise from 120,000 bpd to 1.2 million bpd.

If these levels are achieved, Lukoil will have doubled its overseas output.

“The start of production at West Qurna-2 is strategically important for LUKOIL. Starting up the field on a tight schedule and reaching the target production level underscores LUKOIL’s ability to independently and efficiently manage the implementation of complex large-scale projects and reinforces our position as a global energy company”, said Vagit Alekperov, president of Lukoil.

The West-Qurna project is key to boosting levels of production and revenue in a country still reeling from war.

Iraqi Oil Minister Abdul Kareem Luaibi is reported to have said at the ceremony that output of 400,000 bpd from West Qurna-2 is expected by the end of the year, helping Iraq reach a production target of 4 million bpd for 2014.

West Qurna-2 – one of the largest oil fields in the world – is located in southern Iraq, 65 kilometers from the town of Basra. The field has 35 billion barrels of estimated geological oil reserves in two main formations – Mishrif and Yamama.

The project is being implemented in three phases: Mishrif Early Oil (with a target production level of up to 400 kbpd), Mishrif Full Field Development (up to 550 kbpd) and Yamama Formation Development (up to 1.2 million bpd)). The production plateau will then be maintained at 1.2 million bpd for 19.5 years.

The Development and Production Service Contract for the West Qurna-2 field was signed on January 31, 2010. The stakeholders are the South Oil Company of the Ministry of Oil of Iraq (on behalf of the state) and a consortium of contractors comprising Lukoil (75 per cent) and the Iraqi North Oil Company (25 per cent).

The first field development phase – Early Oil – was launched in record time. The following main production facilities have been completed since April 2012: a 400,000 bpd capacity Central Processing Facility (CPF), 48 development wells, 5 well pads, a 126 MW capacity Gas Turbine Power Plant (GTPP), Euphrates water intake, an over 100 km long export pipeline to the Tuba Tank Farm, additional tanks at Tuba Tank Farm with total capacity of 198,000 m3, a field camp, access roads and additional flow lines.

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