Iraq’s Oil Ministry has approved the sale of Japanese oil major Inpex Corporation’s 40 percent stake in the Block 10 region that contains the vast Eridu oil fields in the southern part of Iraq, clearing the way for Russian Lukoil to take total control of the entire oil-rich area, Oil Price reported.
Russian major Lukoil, with its 60 percent stake, and Japan’s Inpex, with a 40 percent stake, had acquired contracts for the exploration and production of the Eridu field after Iraq’s fourth licensing round in 2012.
Lukoil has been conducting geological exploration at Block 10 for several years. Block 10, covering 5.8 thousand square kilometers, is located 120 kilometers away from one of the world’s most extensive oil fields, West Qurna-2, where Lukoil started commercial oil production in 2014.
Two-dimensional and three-dimensional seismic surveys were conducted, three exploratory wells and six appraisal wells were drilled, and as a result, the Eridu oilfield was discovered with an estimated reserve of 12.9 billion barrels.
While Iraq’s oil ministry has pegged peak production of at minimum 250,000 barrels per day (bpd) from Eridu, Russian oil industry sources believe peak production could run at least 100,000 bpd higher than the previous figure by 2029.
Indeed, Russian companies operating in Iraq are moving toward “promising” investments. Earlier this month, Lukoil extended its development and production contract for Iraq’s West Qurna 2 oilfield, aiming to gradually double oil output to 800,000 barrels per day (bpd).
Lukoil’s deal with Iraq’s Basra Oil Company in Baghdad extended the service contract by ten years up to 2045, with investments into further development of the project and “gradual doubling of the field’s output with plateau level reaching 800 thousand barrels per day.”