April 4, 2013 / 12:25 PM / 5 years ago

OMV starts test production from Kurdistan well

VIENNA, April 4 (Reuters) - Austrian oil and gas group OMV has started test production from a well in Kurdistan, a region it wants to develop as it focuses on exploration, it said on Thursday.

OMV said it started production from the Bina Bawi-3 well on March 20, with an initial capacity of 5,000 barrels of oil equivalent per day and the potential to double it as future wells become available.

The Austrian company also said it had submitted a declaration to the autonomous KRG Kurdistan government to say the well was commercially viable.

“OMV sees the Kurdistan region of Iraq as an important area for growth and the progress on the Bina Bawi field underlines our ability to execute our strategy,” the company’s head of exploration and production, Jaap Huijskes, said in a statement.

Kurdistan’s exploration contracts with oil majors including Exxon Mobil and Chevron are a source of friction with Baghdad, as the Iraqi government says it alone has the authority to control exports and sign contracts.

A long-running feud over the issue has delayed and interrupted exports for several years.

OMV is at an early stage of exploration in Kurdistan. It has two other drilling programmes at Bina Bawi, east of Erbil, and abandoned a third programme after unsatisfactory results.

OMV holds a 36 percent stake in the Bina Bawi field. Genel Energy holds 44 percent, with the remaining 20 percent owned by KRG.

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