Iraq inks preliminary deal with Russian oil firm to develop exploration block in western Iraq

Baghdad, September 5 - Neftegaz.RU. The Iraqi Oil Ministry said that it has signed a preliminary deal with Russia's Stroytransgaz company to explore and develop an oil and gas exploration block in the western province of Anbar, Xinhua reported.

Iraqi Oil Minister Thamir al-Ghadhban said at the signing ceremony that "the exploration block № 17 is one promising site, where preliminary studies and information indicate the existence of oil reserves ranging between 2-4 billion barrels of oil equivalent, as gas accounts for 60-70 % of the reserves," said a statement issued on the ministry's website.

Asim Jihad, spokesman for the ministry, said that "this contract with the Russian company is (a service contract) including exploration, development and production operations within an area of 12,000 sq km, the statement quoted him as saying.

Jihad pointed out that the duration of the contract is 34 years, including 9 years for the exploration phase, and 25 years for the development and production phases, the statement said.

Abdul Mahdi al-Amidi, Gen. director of the petroleum contracts and licensing department, said that the contract commits the Russian company to build a housing complex and develop infrastructure and service sector in the province with an estimated value of $100 million, the statement added.

In 2017, Iraq announced that its proven oil reserves increased to 153 billion barrels from previously estimated 143.1 billion barrels. Iraq's economy heavily relies on exports of crude oil, which account for more than 90 % of the country's revenues.