Iraq’s oil ministry announced Thursday that ExxonMobil will not be permitted to participate in its oil and gas auction this coming May.
The global gas giant was blacklisted after signing six oil contracts last October with the Northern self-ruled Kurdish region – without government approval – to search for oil in six areas.
Sabah al-Saidi, Deputy Head of the Oil Ministry’s Licensing and Petroleum Contracts Department, confirmed that Exxon had been removed from the list of qualified companies because it refused to nullify its illegal oil deals with Kurds as requested by Iraq’s Ministry of Oil.
Exxon is excluded from the list of 47 companies qualified to bid in Iraq’s fourth oil and gas licensing auction this May for 12 oil exploration sites nationwide. Over two thirds of those sites contain natural gas reserves and the remaining blocks a combination of oil and gas.
These exploratory drilling missions are expected to add roughly 29 trillion cubic feet of natural gas to Iraq’s current 126.7 trillion cubic feet in reserves, and about 10 billion barrels of oil to its current 143.1 billion barrels.
While Exxon won’t be awarded ownership or partial ownership of any of the 12 exploration sites at this year’s energy auction, the $50 billion contract that Exxon and Shell signed with Baghdad in late 2009 to develop one of Iraq’s biggest oil fields, the 8.6 billion-barrel West Qurna Stage 1 field in Basra, is still under contract for at least another 17 years.
Back in 2009, before official drilling had commenced at West Qurna, Iraq’s daily oil production ranged between 2.3 million and 2.4 million barrels per day. Last month, Iraq’s oil output rose above 3 million barrels per day for the first time in over 30 years.
With the 12 oil and gas blocks expected to bring in an additional 29 trillion cubic feet of natural gas and 10 billion barrels of oil, combined with the 8.6 billion-barrel West Qurna field, Iraq is targeting an estimated daily production goal of 12 million barrels by 2017, a 500 percent increase in less than a decade.
Until next time,