Iraqi Oil Sector

According to BP's Statistical Review of World Energy, June 2008, Iraq has proven reserves¹ of 115 billion barrels of oil, the third largest of any country in the world behind Saudi Arabia and Iran. According to industry sources, only about one quarter of the fields so far discovered in Iraq are currently producing and none of those are producing at their full potential. In addition, estimates by HIS Inc in 2007 suggest that the unexplored regions of Iraq (e.g. the Western desert) may yield a further 100 billion barrels of proven reserves.

The Iraqi Ministry of Oil has set the target of doubling oil production to 4.4 million bpd within the next four years. The expectation is that this will be driven primarily by the Southern Oil Company ("SOC"). SOC intends to use available surface facilities in addition to drilling 100 - 110 new oil wells. The wells IOSCO expects to drill and complete are conservatively estimated to be capable of a level of production upwards of 5,000 bpd per well. In the longer term, a goal of 6 million bpd by 2013 has been put forward by Iraqi’s State Oil Marketing Organisation.²

¹ Oil that has been definitively discovered and is expected to be economically producible.

² Falah Al-Amri, DG Iraq’s State oil marketing organisation quoted.