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UPDATE 1-Iraq, Samsung Engineering ink $1 bln oil deal
March 22, 2012 / 9:51 AM / 6 years ago

UPDATE 1-Iraq, Samsung Engineering ink $1 bln oil deal

(Adds oil minister quote, details)

BAGHDAD, March 22 (Reuters) - Iraq signed a $1 billion oilfield service contract with South Korea’s Samsung Engineering on Thursday for its West Qurna Phase Two oilfield.

The deal is part of an initial development plan approved by Iraq’s oil ministry in 2010 to start production of the untapped oilfield in the south.

“The project includes building a complete establishment on the ground to produce oil of around 500,000 barrels per day,” said Iraq Oil Minister Abdul Kareem Luaibi.

“We consider this the first phase of the (total) project, which includes producing 1.8 million bpd.”

Five companies, including Saipem, SNC Lavalin Group Inc, Punj Lloyd Ltd, Globalstroy Engineering and Samsung, were short-listed last year to compete for the contract.

Tenders announced were for construction of an oil export pipeline, a tank farm at Tuba, a power distribution station and an associated gas processing plant, and also an oil gathering system, central processing facilities and a water supply system.

Russia’s LUKOIL and Norway’s Statoil sealed a 20-year deal to develop the virgin field in an auction in December 2009, pledging to boost output to a plateau target of 1.8 million bpd in six years.

Statoil said in February it wanted to sell its stake in the giant 12.9 billion barrel oilfield to Lukoil. (Reporting by Aseel Kami; Writing by Serena Chaudhry; Editing by James Jukwey)

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