Hussain al-Shahristani, oil minister, said on Monday the figure covered 66 fields in Iraq and new estimates for the giant West Qurna and Zubair fields. If correct, it would see Iraq leapfrog neighbouring Iran as the country with the world’s second-largest proven reserves.
The US Energy Information Administration lists Iraq as having 115bn barrels in reserves, behind Saudi Arabia, the world’s top producer with 266.75bn barrels, and Iran with 136.1bn.
“The oil reserve is for 66 discovered oilfields in Iraq, and there are many others that have not been discovered yet,” Mr Shahristani said. “It is expected this figure will be increased when these oilfields are discovered.”
Iraq’s oil revenue provides about 95 per cent of its budget. But the sector is underdeveloped following years of conflict and sanctions during Saddam Hussein’s rule.
Iraq has invited international oil companies back into the country and has an ambitious goal of pumping 12m barrels per day by the latter half of this decade, putting it near Saudi Arabia’s production capacity.
Iraq produces about 2.5m barrels of oil per day, and exports roughly 1.9m to 2m barrels. Increasing production will be key to the country’s ability to fund reconstruction and improve dire services.
“There has not been a reserves revision of Iraq for many years so it is not surprising that they have gone up,” said Richard Quin, lead analyst for the Middle East and North Africa upstream team at Wood Mackenzie. “There is a definite expectation that there is a lot of crude in Iraq and the whole area has been underdeveloped.”
Dr Manouchehr Takin, senior petroleum upstream analyst at the Centre for Global Energy Studies, said that although he had not seen the exact details of the revision, he did not think it was “purely political”.
“I am optimistic. It must have been in part the upgrading of existing fields,” he said.
Still, efforts to boost production will depend on the political environment, which has been dogged by an almost seven-month deadlock since the March 7 elections, and the security situation is tense as the US prepares for a complete military withdrawal by the end of next year.
There are also tensions between Arabs and Kurds in disputed oil-rich areas in the country’s north.
Iraq’s proven reserves had been 115bn barrels, already the world’s third largest, but the data that the figure was based on were believed to be outdated.
The new reserve figure was reached with the help of international oil companies working at 12 fields in Iraq, Hussain al-Shahristani, the oil minister, said in a news conference.
“The rise in reserves from West Qurna and Zubair has considerably contributed to the rise,” Mr Shahristani said.
Mr Shahristani said the West Qurna field had reserves of 43.302bn barrels, making it the second largest field in the world.
The oil ministry has been carrying out 3D seismic surveys to update its oil reserves data.
Decades have passed with very little oil exploration activity in Iraq, and reserves data, largely based on outdated technology, have not been revised for years.
Oil majors are moving ahead with a series of deals to unlock reserves that could boost Iraq’s production capacity to Saudi Arabia’s level of 12m barrels per day from 2.5m bpd now.
The deals could provide Iraq with the billions of dollars it needs to rebuild after years of war, sanctions and decline.
A rise in Iraq’s proven reserves is unlikely to change the global energy scene in the short term, but will cement its position as an oil power and strengthen its hand within Opec, analysts said.
