By Ahmed Rasheed
BAGHDAD Nov 12 Iraq's Majnoon oilfield,
operated by Royal Dutch Shell, is expected to hit
output above 200,000 barrels per day (bpd) in the third quarter
of 2013 - above the level needed to start recovering costs,
Shell's 2013 programme for Majnoon said.
The company's outlook is positive news for Iraq's government
whose oil policy has been damaged by news that Exxon Mobil Corp.
will pull out of a major oilfield project and shift its
attention to the country's autonomous Kurdistan region.
Majnoon, one of the OPEC member's major fields, started a
shutdown in June for maintenance and to bring new production
Under the Majnoon development plan for 2013, Shell has
submitted a budget of $1.384 billion as a "total recoverable
cost" for field development, a copy of the programme obtained by
Operations at the field are expected to resume in the first
quarter of 2013 with output of 44,600 bpd and 50,200 bpd in
second quarter. Shell is targeting 201,700 bpd output there in
the third quarter and 202,700 bpd in the fourth.
Shell and minority partner Petronas of Malaysia,
won the Majnoon service contract by promising to boost the
largely undeveloped field to 1.8 million bpd for a fee of $1.39
a barrel, though it started talks with Baghdad this year to
reduce the target at the super-giant field to 1 million barrels
Under the contract the consortium should reach a 170,000 bpd
output - its so called First Commercial Production level - to
trigger it to retrieve investment costs.
"The scope of work for First Commercial Production involves
following key elements: production optimisation from the
existing well stock, drilling of 18 new wells and
de-bottlenecking and upgrading of existing facilities," the
Majnoon development programme showed.
Production at the field was around 45,000 bpd when Shell
took over in 2010. Shell has since spent around $1 billion, and
planned to invest another $1 billion in 2012.
The programme said that at the end of this year 14 wells
would have been completed and this process would replace
existing wills contaminated with water.
"By the end of 2012, 14 wells are expected to have been
completed, including 3 wells to be drilled by a Schlumberger
rig, thereby offsetting wet production wells in the existing
well stock," the development program showed.
The 12.6 billion barrel Majnoon field is one of the main
fields alongside Rumaila, West Qurna Phase One and Zubair, that
Iraq is developing with foreign companies in the south of the
country as it recovers from years of war and sanctions.