The Iraqi government signed revised deals with BP and China’s CNPC for two southern oilfields Thursday that reduced production targets and extended the life of the deals.
The Iraqi government revised BP’s deal for the Rumaila oilfield, cutting the planned plateau production level to 2.1 million barrels per day from 2.85 million bpd, Reuters said.
Iraq also revised CNPC’s deal for the Halfaya oilfield and cut the final output target to 400,000 bpd from 535,000 bpd.
BP operates the Rumaila field with a 38 percent share. CNPC holds a 37 percent stake and Iraq’s State Oil Marketing Organization (SOMO) holds a 25 percent stake.
Rumaila has an estimated reserve of 17 billion barrels.
The field is currently producing around 1.3 million bpd. That level is expected to remain steady for the rest of the year.
The time frame to hit the final production target at Rumaila was extended to 10 years from seven.
The revised deal for CNPC’s Halfaya field extends the life of the contract to 30 years from 20.
Halfaya is currently producing 200,000 bpd. Output is projected to grow to 230,000 bpd by the end of this year.
CNPC operates Halfaya and holds a 37.5 percent stake. France’s Total holds a 18.75 percent interest, Malaysia’s Petronas holds a 18.75 percent and SOMO holds a 25 percent stake.
Iraq had set its overall production capacity target to 12 million bpd by 2020.
However, bureaucratic red tape, infrastructure issues and the lack of clear oil legislation have slowed investment and caused Iraq to repeatedly fail to meet its output targets.
Iraq’s current output is hovering around 3 million bpd.