Qayara oil field

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Oil Reserves 800 million barrels (2010)[1]
Discovered 1927
First Produced 1930s
Location Nineveh governorate, south-east.
Principal Partners Sonangol (75%)[2]
Secondary Partners South Oil Company (25%)[3]
API Specificity 15

The 800-million barrel Qayara field is located in Nineveh, known as one of the most dangerous regions of the country.[4] The field was discovered in 1927 by British Oilfield Development.[5] Qaraya lies within the same structures as Najmah field.[6]

The deposit is notable for its very heavy and sour crude compared to the crudes of other Iraqi fields.[7] In 1990 the oil could not yet be refined and only a limited volume was used for asphalt and other purposes. All of the surrounding fields contain large accumulations of very sour soil (11-18 API with 6.5-8% sulphur). Oil at Qayara itself has an API gravity of 15°, by far the lowest among the ten fields offered at Iraq's second bidding round. [8]

Contract Negotiations

In December 2009, the field was awarded by the Iraqi government to Angolan Sonangol in the second bidding round, when the company was the sole bidder for the contract.[9]

Sonangol signed a deal with the Iraqi government on the 26 January 2010, to take a 75% stake in a venture to exploit the Qayara field. Under the terms of the deal, Sonangol will receive a remuneration fee of $5 per barrel and said that it would invest $2 billion at the field. According to Reuters, the oil company could start recovering costs once production levels hit 30,000 bpd.[10]

The remuneration fee accepted was among the highest paid to any of the oil firms that won contracts at tender, reflecting the security risks in the region and the relatively low quality of the oil at the site.[11]

Originally, the firm had rejected cutting its bid fee of $12.50 per barrel but won the deal after revising estimates that excluded the cost of facilities to lighten the heavy oil, according to a senior Sonangol official.[12]. The consortium is committed under the agreement to reaching a production plateau of 120,000 barrels a day, and holding it for nine years.[13]

References

  1. "IRAQ: Angola's Sonangol sign Iraqi oilfield deals" ITN, 28 January 2010.
  2. "Duo Eye Sonangol's Iraqi Assets" Iraq Energy, 20 July 2010.
  3. "Duo Eye Sonangol's Iraqi Assets" Iraq Energy, 20 July 2010.
  4. "Iraq oil contract goes to Angola's Sonangol" BBC, 30 December 2009.
  5. "RAQ - The Main Fields In The North" Free Library, retrieved 12 December 2011.
  6. "RAQ - The Main Fields In The North" Free Library, retrieved 12 December 2011.
  7. "Sonangol wins oil deals in Iraq's riskiest region" Reuters, 12 December 2009.
  8. "RAQ - The Main Fields In The North" Free Library, retrieved 12 December 2011.
  9. "Iraq fails to award contract for Qayara oilfield" Allrroya, 12 December 2009.
  10. "FACTBOX-Oil deals between Iraq and global majors" Reuters, 26 February 2010.
  11. "Duo Eye Sonangol's Iraqi Assets" Iraq Energy, 20 July 2010.
  12. "Sonangol wins oil deals in Iraq", Reuters, 12 December, 2009
  13. "Sonangol wins oil deals in Iraq's riskiest region" Reuters, 12 December 2009

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