BP lets major drilling contracts for Rumaila oil field redevelopment in Iraq

Source: BP

BP, on behalf of its partners in the Rumaila Technical Services Contract, announced the first major contracts to support the rehabilitation of the Rumaila field in Southern Iraq. Formal contracts will be signed in due course.

Three contractor groups were selected for drilling wells, worth around $500 million in total and will provide 7 additional drilling rigs from the second half of 2010. The contracts will be awarded to Schlumberger in partnership with the Iraqi Drilling Company has been awarded contracts for three rigs, Daqing Drilling has also been awarded contracts for three rigs, and Weatherford has been awarded a contract for one rig.

These contracts supplement drilling contracts already in place on Rumaila provided by the Iraqi Drilling Company and Weatherford. We expect around 70 wells to be drilled on Rumaila this year.

Two two-year contracts, worth a total of around $100 million, have been awarded for the supply and installation of electrical submersible pumps (ESPs) and associated services to Centrilift, Al-Khorayef Petroleum. Cameron will supply the associated trees and wellheads.

The contractors were selected after a competitive bidding process and the awards endorsed on March 24th in Basra by the members of the Rumaila Joint Management Committee comprising BP, CNPC, the Iraqi State Oil Marketing Organisation and the South Oil Company.

"We are pleased to announce these contracts at competitive market rates and meeting the highest technical specifications," said Michael Townshend President, BP Iraq. ‘We are confident that all of the companies will bring the operational and safety standards which will help us achieve our production targets in Iraq for 2010 and beyond.

Rumaila Oil Field

The Rumaila field is one of the world’s largest oil fields and currently produces just over one million barrels of oil a day. In June, BP and CNPC were the sole winners in Iraq’s first post-war licensing round with a bid which envisaged raising production to 2.85 million barrels a day, in return for a $2 per barrel fee for the incremental production.

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