Oryx Petroleum has shut in production at its Demir Dagh field in the Kurdish region of Iraq but will move ahead with development plans for the field.
The company said Wednesday there have been no sales from the field since late October due to “local market dynamics” including periodic disruption of sales to third party marketers.
Gross oil production at Demir Dagh averaged 4,400 barrels per day in October, with peak daily production coming in at just under 7,000 bpd.
The company said the sales situation is “expected to normalize over the coming months” but a target date for restarting sales has not been set yet.
Oryx will continue developing the field despite the shut in.
During the past two months the company spudded the Demir Dagh-10 and Demir Dagh-11 wells.
Both wells will be tested once DD-11 is complete.
Alberta-based Oryx said observations made at the two wells during drilling have been “consistent with expectations.”
Seven additional development wells are planned for the Demir Dagh field before the end of 2015.
Oryx will also tie the Demir Dagh-7 well into the field’s production facilities in the coming weeks, bring production capacity to over 15,000 bpd.
On Tuesday, the Iraqi and Kurdish governments signed an oil export deal that will deliver 550,000 barrels of oil per day from Kurdish fields to Iraq’s oil ministry.
Orxy CEO Michael Ebsary called the deal “very encouraging.”
Trial deliveries of crude oil from Demir Dagh to the Khurmala entry point of the KRI-Turkey pipeline have started and, if there are successful, Oryx plans to increase deliveries.
“Such progress has many positive implications for sales of crude oil produced in the Kurdistan Region to both export and domestic markets as well as for the fiscal stability and security of the Kurdistan Region,” Ebsary said.