The state-owned China National Petroleum Corp (CNPC) and Sinopec, together with non-Chinese partner-firms, could be producing more than 4m b/d of crude oil in Iraq, including Kurdistan, before the end of this decade. This would be more than ten times what they may pump in Iran. But the Iraqi or Iranian crude oils will not belong to China and its partners as most of the volume will be produced under service contracts. Yet the symbolism is of major strategic importance to China, the world's second largest oil consumer next to the US which is set to overtake the American energy market in the coming decades.
CNPC is BP's partner in developing Rumaila, Iraq's largest oilfield near the southern city of Basra. The field's proven remaining oil reserves are put at 15.25bn barrels. Under a 20-year service contract they signed with the Ministry of Oil (MoO) in 2009, this field's current output of 1.05m b/d should rise to 2.85m b/d by 2017 or before. BP and CNPC will together earn 75% of the net $2/b service fee (after all expenses are covered by the MoO), with the remaining 25% to go to MoO's South Oil Co. (SOC). MoO's regional companies have 25% in each field development project being undertaken by IOCs in Iraq with the exception of the autonomous Kurdish north, where the KRG has granted foreign firms 25-year exploration and production sharing agreements (EPSAs).
rolex fakeThe MoO says KRG's EPSAs are illegal and must be annulled, while Erbil insists on their legitimacy as called for by its own petroleum E&P law ratified by its local parliament. The MoO has blacklisted all firms having EPSAs in Kurdistan, such as replica clothing Sinopec where it plans to produce over 400,000 b/d of northern Iraqi crude oil before 2015.
From Rumaila, CNPC will earn over $1.326m per day out of its share of an incremental production of 1.8m b/d. BP will earn a little more. These are net profits.
CNPC (50%), in partnership with Petronas of Malaysia (25%) and Total of France (25%), is developing Halfaya in the south which will produce a minimum of 535,000 b/d within about five years. The net fee in this 20-year contract is $1.4/b. CNPC's share from it is over $280m/d. This field's reserves are put officially at 4.6bn barrels.
In addition, CNPC is developing al-Ahdab field in the south-central Iraqi province of Waset under a 20-year service contract signed in November 2008 - the very first deal signed with an IOC before the MoO auctioned off a number of oil and gas fields in two rounds in 2009. Al-Ahdab's reserves are put at 1bn barrels. The CNPC deal for this is worth $3bn. (Ahdab had been awarded to CNPC and Norinco under a $1.3bn PSA signed on June 4, 1997. Norinco is one of China's industrial and military construction combines intending to join CNPC in major E&P ventures in the Middle East and other parts of the world. CNPC had negotiated with Saddam's regime to develop Halfaya, a giant which is also rich in gas - but that deal was hit by the UN embargo - see 2007 survey of Iraq in down19IraqFieldsMay7-07). Work on Ahdab began in January 2009 and was officially inaugurated on March 11 in a ceremony attended by Minister Shahristani, COC executives, Waset council officials and Chinese officials. Ahdab should eventually produce 110,000-130,000 b/d (see 2009 survey of Iraq in down19IraqFieldsMay11-09).
China is thus a major player in Iraq and stands to gain much business in this country as well as in Kurdistan, where the KRG is negotiating with Sinopec a major oil refinery to be built as a JV. It is said the KRG wants the
embroidered patches refinery to
Other articles:
http://www.yidblog.com/blog.php?user=mywatches¬e=106205