Chevron wins deal to develop oil fields in Iraq's Basra
US oil giant Chevron has finalized a basic agreement to develop key oil fields in Iraq’s southern province of Basra.
The award could be the second serious investment by an American energy enterprise in the country after rival ExxonMobil won a deal in 2009 to develop West Qurna I.
Chevron’s contract – which was signed with the state-run Basra Oil Company – would involve studies to survey the reservoirs and extraction operations at Basra oil fields, according to a report by Reuters.
This followed an announcement by Iraq’s Oil Minister Jabar al-Luaibi in June that Basra Oil and another state-run company, Dhi Qar Oil, had signed a memorandum of understanding (MoU) over certain projects with Chevron.
The MOU provides for Chevron to conduct surveys and studies on oil sites and installations and help the two Iraqi companies to improve their technical, administrative and financial performance, Reuters added.
Earlier, reports said the US giant had signed a confidentiality agreement with Basra Oil Company that could see it study – and boost production from – the state-run Luhais, Tuba, and Subba fields.
No further details were provided but Reuters quoted Iraqi officials as saying that the broader deal appeared to be similar in structure to the Oil Ministry's engagement with BP to study and generate development plans for Kirkuk-area fields.
Basra is an important hub for oil exports and accounts for over 95 percent of Iraq’s government revenues.
However, the province has been the scene of protests lately over corruption, poor infrastructure and insufficient welfare.
State officials blame a public funding crisis caused by years of low oil prices.
Since the unrest in Iraq’s south erupted, demonstrators have vented their anger at several major oil fields in Basra but this, as Iraqi officials say, has created no major disruption in the province’s oil production as well as exports.
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